Figure 11-4

question 43

Multiple Choice

Figure 11-4
-Refer to Figure 11-4. If the Fed acts to close the output gap in Panel (a) , it would

• A) sell government bonds which will lead to the shift in demand for bonds in Panel (b). This action will raise the price of bonds and lower the interest rate.
• B) buy government bonds which will lead to the shift in demand for bonds in Panel (b). This action will raise the price of bonds and increase the interest rate.
• C) buy government bonds which will lead to the shift in demand for bonds in Panel (b). This action will raise the price of bonds and lower the interest rate.
• D) sell government bonds which will lead to the shift in demand for bonds in Panel (b). This action will raise the price of bonds and increase the interest rate.

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Definitions:

Variables

Elements or factors within a research study or experiment that can change and potentially affect the outcome of the study.

Test The Hypothesis

A process in scientific research where an assumption is investigated through controlled experiments or observations to determine its validity.

Bipolar Disorder

is a mental health condition characterized by extreme mood swings, including emotional highs (mania or hypomania) and lows (depression).

Experiment

An investigative process conducted to uncover new findings, verify a hypothesis, or prove an established fact.