If Inflation Increases, the Central Bank Acts to Raise Interest

question 39

Multiple Choice

If inflation increases, the central bank acts to raise interest rates in order to

• A)increase the money supply.
• B)reduce real GDP.
• C)increase real GDP.
• D)increase potential GDP.
• E)reduce potential GDP.

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Definitions:

Psychotherapy

A general term for treating mental health problems by talking with a psychiatrist, psychologist, or another mental health provider, focusing on understanding and resolving problematic behaviors, beliefs, feelings, and relationship issues.

Sigmund Freud

A neurologist from Austria who initiated the practice of psychoanalysis, which involves treating mental disorders by engaging patients in conversation with a psychoanalyst.

Psychoanalysis

A method of psychological therapy and analysis of the human psyche, developed by Sigmund Freud, focusing on unconscious processes.

Insight Therapies

Forms of psychotherapy aiming to improve mental health by encouraging understanding of one’s problems and motivations.