AE curve shifts to the right in 2020 and returns to its initial position in 2021. Suppose

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AE curve shifts to the right in 2020 and returns to its initial position in 2021. Suppose the Federal Reserve anticipates the shock in this practice: in 2019, it knows what will happen in the following two years. Assuming time lags of monetary policy exist, can the Federal Reserve keep output and inflation constant? If it can, explain how; if it can't, explain why not.

Posted Date: May 18, 2024 06:15 PM

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AE curve shifts to the right in 2020 and returns to its initial position in 2021. Suppose

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