Influence the effectiveness of discretionary policy

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Describe how expectations can influence the effectiveness of discretionary policy

Using an AD-AS diagram, illustrate the short-run effects on prices, output, and employment of an increase in the money supply that is correctly anticipated by the public. Assume that the economy is initially at potential output.

Reference no: EM13774158

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Influence the effectiveness of discretionary policy : Describe how expectations can influence the effectiveness of discretionary policy. Using an AD-AS diagram, illustrate the short-run effects on prices, output, and employment of an increase in the money supply that is correctly anticipated by the publ..

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