Solved: Suppose the government decided to tighten monetary policy, Macroeconomics

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Suppose the government decided to tighten monetary policy

Suppose the government decided to tighten monetary policy and decrease government expenditures. In the short run in the Keynesian model, the effect of these policies would be to _____ the real interest rate and _____ the level of output.

(a) lower; decrease

(b) lower; have an ambiguous effect on

(d) raise; decrease

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Macroeconomics: Suppose the government decided to tighten monetary policy

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Macroeconomics: Suppose the government decided to tighten monetary policy

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