If the economy is operating below its full employment level, the Fed can

A) increase aggregate supply by raising the price level.
B) increase aggregate demand by selling bonds and raising interest rates.
C) increase aggregate demand by stimulating the demand for money.
D) increase aggregate demand by increasing the rate of growth of the money supply.


D

Economics

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Free markets promote all of society’s goals.

Answer the following statement true (T) or false (F)

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Draw an aggregate supply and aggregate demand graph which shows the economy producing an output which exceeds potential output in the short run, and the adjustment that will occur as the economy adjusts to long-run equilibrium

What will be an ideal response?

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In the figure above, if pizza production increases to 15,000 pizzas a day, then marginal benefit ________ marginal cost, and ________ occurs

A) exceeds; overproduction B) exceeds; underproduction C) is below; overproduction D) is below; underproduction E) exceeds; efficient production

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Table 7-6 Number of ovens 2 2 2 2 2 2 2 2 Labor hours used 1 2 3 4 5 6 7 8 Loaves of bread produced 20 34 55 70 82 91 94 92 Table 7-6 shows a baker’s daily production relationship for bread. Diminishing returns to labor begin when the baker goes from

A. one hour of labor to two hours of labor. B. three hours of labor to four hours of labor. C. six hours of labor to seven hours of labor. D. seven hours of labor to eight hours of labor.

Economics