Exhibit 16.4 -Refer to Exhibit 16.4. If the Fed Follows the Announced

question 183

Multiple Choice

Exhibit 16.4

-Refer to Exhibit 16.4. If the Fed follows the announced stable-price policy of keeping prices at P' and keeping the economy at its potential, the Fed must stimulate aggregate demand as much as workers and firms expect (shown by point_____) , but this is _____.

• A) c, inflationary
• B) d, inflationary
• C) e, inflationary
• D) c, deflationary
• E) d, deflationary

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Geriatric Depression Scale

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