please answer in text form and in proper format answer with must explanation , calculation for each part and steps clearly The slope of the monetary policy rule line when the nominal interest rate is measured on the vertical axisisO less than 1.zero.O greater than 1.equal to 1.O equal to -1.

A rule frequently governs how central banks modify interest rates in monetary policy in response to…

Answered: The slope of the monetary policy rule…

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter22: Money Growth And Inflation

Section: Chapter Questions

Problem 1CQQ

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Suppose the monetary policy curve is given byr = 1.5 + 0.75p, and the IS curve is given byY = 13 - r.a. Calculate an expression for the aggregate demandcurve.b. Calculate the real interest rate and aggregate outputwhen the inflation rate is 2%, 3%, and 4%.c. Draw graphs of the IS, MP, and AD curves, labelingthe points from part (b) on the appropriate graphs.
1. Which of the following is concerned with changing the aggregate demand of thenation?A) External balanceB) Internal balanceC) Expenditure-changing policiesD) Expenditure-switching policiesAnswer: 2. Which of the following is an example of an expansionary monetary policy?A) Increase in TaxesB) Increase in the nation's money supplyC)Increased government expendituresD) Reduction in taxesAnswer:
Considering how monetary policy affects the market, which of the following statements is most accurate? There is an indirect impact on aggregate demand by monetary policies. O There is more of an impact on consumption than investments by monetary policies. There is a direct impact on aggregate demand by monetary policies.
. How does monetary policy affect aggregate demand? a) By influencing consumer spending only b) By influencing investment spending only c) By influencing both consumer and investment spending d) By influencing government spending only -. A central bank uses contractionary monetary policy to: a) Combat deflation
Generally, monetary policy's effectiveness is impeded by the adaptive expectations of the public. O information available to the public. O the rational expectations of the public A and B B and C
Some economics, notably Keynesians, believe that _______________.Group of answer choices A. since both V and Q are constants for an economy in short-run equilibrium, the equation of exchange becomes the quantity theory of money which explains prices B. even though velocity isnt constant, it is predictable C. If a change in M occurs, it may not only affect P, but also and at the same time affect Q
Explain the type of monetary policy a government would implement in order tocurb inflation.
Interest Rate Interest Rate Inflation Policy Rule A Policy Rule B 0 0.5 1.5 2 4 5 4 7.5 8.5 6 11 12 8 14.5 15.5 If the central bank changes its monetary policy rule from A to B as shown in Exhibit 24-3, O the monetary policy rule line will shift to the right. O there will be no change in the real rate of interest. O the real rate of interest will decline. O there has been an increase in the target inflation rate. the monetary policy rule line will shift to the left.
Interest Rate Interest Rate Inflation Policy Rule A Policy Rule B 0 0.5 1.5 2 4 5 4 7.5 8.5 6 11 12 8 00 14.5 15.5 If the central bank changes its monetary policy rule from A to B as shown in Exhibit 24-3, ○ the monetary policy rule line will shift to the right. O there will be no change in the real rate of interest. O the real rate of interest will decline. there has been an increase in the target inflation rate. the monetary policy rule line will shift to the left.
Tightening monetary policy causes interest rates to O none of the other answers are correct. O fall; demand; increase O fall; supply; increase O rise; supply; decrease Orise; demand; decrease and aggregate to
Suppose now that economists expect the velocity ofmoney to increase by 50% as a result of the monetarystimulus. What will be the total increase in nominalGDP?
If a central bank uses the tools of monetary policyto reduce the demand for goods and services, thelikely result is _________ inflation and _________unemployment in the short run.a. lower; lowerb. lower; higherc. higher; higherd. higher; lower

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The slope of the monetary policy rule line when the nominal interest rate is measured on the vertical axis is O less than 1. zero. O greater than 1. equal to 1. O equal to -1.