Suppose in the short run there is a negative shock to the goods market; assume prices are

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Suppose in the short run there is a negative shock to the goods market; assume prices are fixed in the short run in this question.

a. Give all the ways the goods market can suffer a negative shock in the short run.

b. If, due to monetary policy, the real interest rate remains constant in the short run, explain how this negative shock to the goods market affects national saving, private saving, government saving, and investment.

Related Book For answer-question

Physical Chemistry

ISBN: 978-0321812001

3rd edition

Authors: Thomas Engel, Philip Reid

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Posted Date: Nov 22, 2022 10:01 AM

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Suppose in the short run there is a negative shock to the goods market; assume prices are

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