When Output Is Below Potential and the Policy Rate Has

question 37

Multiple Choice

When output is below potential and the policy rate has hit the floor of zero,if policymakers do nothing,output will ________ and inflation will ________.

• A)rise;fall
• B)fall;fall
• C)fall;rise
• D)rise;rise

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Definitions:

Strategies

Plans of action designed to achieve long-term or overall goals and objectives.

Mission

A statement that defines the purpose, goals, and values of an organization, guiding its strategies, decisions, and operations.

Business

The clear, broad, underlying industry or market sector of an organization’s offering.

Performance Targets

Specific goals set for individuals or teams to achieve within a set timeframe, often used as a measure of productivity or quality in the workplace.