Question: Using the following monetary policy reaction function; r = r0 + 0.5 ? if the RBA wished to implement an expansionary monetary policy in response

Using the following monetary policy reaction function;

r = r0 + 0.5 ?

if the RBA wished to implement an expansionary monetary policy in response to a sharp fall in house prices, it should?

Using the following monetary policy reaction function; r = r0 + 0.5 1': if the RBA wished to implement an expansionary monetary policy in response to a sharp fall in house prices, it should? reduce the value of r0 increase the value of r0 leave the value of r0 unchanged increase the value of 11 None of the above

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