October 7, 2015

Homework Help: macoreconomics

Posted by jen on Thursday, October 24, 2013 at 11:11pm.

Suppose there is a temporary but significant increase in oil prices in an economy with an upward-sloping Short-Run Aggregate Supply (SRAS) curve. If policymakers wish to prevent the equilibrium price level from changing in response to the oil price increase, should they increase or decrease the quantity of money in circulation? why?

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