1) 2) 3) The intellectual leader of the monetarists was Paul Romer. John Maynard Keynes. Robert...

Question

Question

1)

The intellectual leader of the monetarists was Paul Romer. John Maynard Keynes. Robert Lucas. John Taylor Milton Friedman.

2)

If the IS curve is relatively steep, then monetary policy cannot be very effective in changing GDP. budget deficits will not

3)

The steeper is the curve, a given change in the money supply will have a greater effect on output the more effective is monet

Answer 1

Answer #1

Answer 1 - Option E

Milton Firedman was the intellectual leader of monetarists

The other options are wrong as they are not called the leader of monetarists.

Answer 2 - Option A

Monetary policy will not be very effective in changing the GDP.

This is because the steeper IS curve shows the insensitive investment and interest rates in response to the monetary policy.

The other options are wrong with respect to steep IS curve.

Answer 3 - Option D

Less effective is monetary policy.

As said in the above part , the investment will be insensitive to the changes in momey supply. Hence the IS curve will be steaper.

Other options are the wrong reason of the steap slope of the IS curve.

Answer 2