Suppose a wave of negative “animal spirits” overrunsthe economy, and people become pessimistic aboutthe future. To stabilize aggregate demand, the Fedcould _________ its target for the federal funds rateor Congress could _________ taxes.a. increase; increaseb. increase; decreasec. decrease; increased. decrease; decrease
Suppose a wave of negative “animal spirits” overrunsthe economy, and people become pessimistic aboutthe future. To stabilize aggregate demand, the Fedcould _________ its target for the federal funds rateor Congress could _________ taxes.a. increase; increaseb. increase; decreasec. decrease; increased. decrease; decrease
Economics (MindTap Course List)
13th Edition
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter16: Expectations Theory And The Economy
Section: Chapter Questions
Problem 10QP
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Question
Suppose a wave of negative “animal spirits” overruns
the economy, and people become pessimistic about
the future. To stabilize aggregate demand, the Fed
could _________ its target for the federal funds rate
or Congress could _________ taxes.
a. increase; increase
b. increase; decrease
c. decrease; increase
d. decrease; decrease
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