Table 17-2 -Refer to Table 17-2

question 63

Multiple Choice

Table 17-2
$$\begin{array} { | c | c | c | c | } \hline \text { Year } & \text { Potential Real GDP } & \text { Real GDP } & \text { Price Level } \\\hline 2014 & \$ 14.0 \text { trillion } & \$ 14.0 \text { trillion } & 150 \\\hline 2015 & 14.5 \text { trillion } & 14.2 \text { trillion } & 152 \\\hline\end{array}$$
-Refer to Table 17-2.Consider the hypothetical information in the table above for potential real GDP,real GDP and the price level in 2014 and in 2015 if the Federal Reserve does not use monetary policy.If the Fed uses monetary policy successfully to keep real GDP at its potential level in 2015,which of the following will be higher than if the Fed had taken no action?

• A)real GDP and the unemployment rate
• B)real GDP and the inflation rate
• C)real GDP and potential GDP
• D)potential GDP and the inflation rate

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Definitions:

Plasticity

The brain’s ability to change and adapt in response to experience, through neurogenesis, or by reorganizing or growing new neural connections.

Cerebellum

A part of the brain at the back of the skull in vertebrates, which coordinates and regulates muscular activity.

Clumsy

Lacking coordination in movement or in handling objects, often leading to accidents or awkwardness.

Uncoordinated

Lacking the ability to move or react in a smooth, efficient, and purposeful manner, often due to deficiencies in motor skills or spatial awareness.