Ask Question
12 January, 13:58

To fight the ongoing inflation the central bank reduces the supply of money by 30%. the long-run effect of this policy on the real gdp and the general price level will be:

+5
Answers (1)
  1. 12 January, 14:50
    0
    To fight the ongoing inflation the central bank reduces the supply of money by 30%. The long-run effect of this policy on the real GDP and the general price level will be parallel. This means nominal input or GDP also decreases including consumer spending, which causes a shift of aggregate demand (AD) curve towards the left - corresponding to lower price level.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “To fight the ongoing inflation the central bank reduces the supply of money by 30%. the long-run effect of this policy on the real gdp and ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers