Refer to Table 12.1 for the Following Question

question 76

Multiple Choice

Refer to Table 12.1 for the following question.
Table 12.1

-Refer to Table 12.1. Consider the hypothetical information in the table for potential GDP, real GDP and the price level in 2016 and in 2017 if the Reserve Bank of Australia does not use monetary policy. If the Reserve Bank of Australia wants to keep real GDP at its potential level in 2017, it should:

• A)buy government securities.
• B)sell government securities.
• C)increase interest rates.
• D)increase income taxes.

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Definitions:

Redeem

To recover ownership of something by paying off a debt or fulfilling an obligation.

Residual Assets

The remaining assets that belong to shareholders after a company has paid all its debts and obligations.

Dissolution

The act of dissolving or ending an entity, such as the termination of a corporation or partnership.

Federal Statute

A law enacted by the United States Congress that applies to all states, territories, and possessions under U.S. jurisdiction.