Use the Following to Answer Questions

question 89

Multiple Choice

Use the following to answer questions .
Exhibit: Monetary Policy and Long-Run Aggregate Demand and Aggregate Supply
-(Exhibit: Monetary Policy and Long-Run Aggregate Demand and Aggregate Supply) If the economy is at point c, the Federal Reserve can close the output gap by buying bonds. In the bond market,

• A) the supply curve shifts right, leading to a decrease in bond prices and an increase in interest rates.
• B) the demand curve shifts right, leading to an increase in bond prices and a decrease in interest rates.
• C) the supply curve shifts left, leading to an increase in bond prices and an increase in interest rates.
• D) the demand curve shifts left, leading to a decrease in bond prices and an increase in interest rates.

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Definitions:

Physical Distribution

The activities involved in moving a product from the point of production to the point of consumption, including transportation, warehousing, and inventory management.

Globalization

The process by which businesses or other organizations develop international influence or start operating on an international scale, leading to the global integration of economies, cultures, and politics.

Rapid Change

The fast and significant transformation in a situation or environment, often affecting organizations, societies, or markets.