Insuu, IUWE 19

Economics Sep 09, 2020

Insuu, IUWE 19. Monetary policy will have a large income effect provided the A) sensitivity of autonomous spending to interest rates is high. B) sensitivity of autonomous spending to interest rates is low. C) sensitivity of output changes to interest rates is small. D) None of the above.

Expert Solution

Option b is the corect answer.

Sensitivity of autonomous spending to interest rates is low.

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