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24.8 APPENDIX 24.1 The Effects of Macroeconomic Shocks on Asset Prices
Autonomous monetary policy ____ real interest rates and ____ aggregate output
temporarily.
A) raises; raises
B) raises; lowers
C) lowers; raises
D) lowers; lowers
Answer: A
Diff: 2 Type: MC Page Ref: 24.1A- 1
Skill: Recall
Objective List: Appendix: The Effects of Macroeconomic Shocks on Asset Prices
An anomoumous monetary policy that reduces real interest rates will ____ the inflation
rate ____.
A) raise; temporarily
B) raise; permanently
C) lower; permanently
D) lower; temporarily
Answer: A
Diff: 2 Type: MC Page Ref: 24.A1- 1
Skill: Recall
Objective List: Appendix: The Effects of Macroeconomic Shocks on Asset Prices
A ____supply shock ____ prices will cause the real interest rate to ____ in the
short run.
A) temporary; raises; rise
B) temporary; lowers; fall
C) permanent; raises; fall
D) permanent; lowers; rise
Answer: A
Diff: 2 Type: MC Page Ref: 24.1A- 3
Skill: Recall
Objective List: Appendix: The Effects of Macroeconomic Shocks on Asset Prices