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Macroeconomics

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Moderate

Classical Dichotomy and Money Neutrality

MACRO-WCVDTB

Fill in the blanks below to complete the paragraph.

According to the Classical Dichotomy, in the long-run,

variables are

from the

side of the economy. As such, classical economists believed in the long-run

of money. Specifically, real variables can only be affected by other

variables. For example, an improvement in potential GDP could be caused by

.