The text analyzes the case of a temporary shock to the demand for goods and services. Suppose,

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The text analyzes the case of a temporary shock to the demand for goods and services. Suppose, however, that et were to increase permanently. What would happen to the economy over time? In particular, would the inflation rate return to its target in the long run? Why or why not? How might the central bank alter its policy rule to deal with this issue?
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Macroeconomics

ISBN: 978-1464168505

5th Canadian Edition

Authors: N. Gregory Mankiw, William M. Scarth

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