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- In the case of a negative shock
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Card 67 / 145: In the case of a negative shock to aggregate demand, the central bank should
A)
decrease the rate of growth in the price level to keep real growth high.
B)
decrease the rate of growth in the money supply to control inflation.
C)
do nothing.
D)
increase the rate of growth in the money supply to restore spending growth.
Answer:
D) increase the rate of growth in the money supply to restore spending growth.
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