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Category > Economics Posted 13 May 2018 My Price 2.00

sticky price model

Suppose, in the sticky price model, that there is deficient financial liquidity, as we studied in Chapter 13, and that there is a positive output gap. What will be the effect of a reduction in the central bank’s target interest rate? Construct a diagram and explain your results. What would the appropriate monetary policy be?

 

 

 

 
 

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Maurice Tutor
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Status NEW Posted 13 May 2018 01:05 PM My Price 2.00

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