If the AS and the AD Curve Intersect at a Level

question 115

Multiple Choice

If the AS and the AD curve intersect at a level of real GDP that exceeds potential GDP,then the appropriate monetary policy is one that ________ the federal funds rate and ________ aggregate demand.

• A)raises;increases
• B)raises;decreases
• C)lowers;increases
• D)lowers;decreases
• E)raises;has no effect on

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Definitions:

Organizations

Entities comprising multiple people working together in a structured way to achieve a collective goal or set of goals.

Beliefs and Assumptions

Fundamental convictions or premises that individuals hold to be true, guiding their behavior and interpretation of events.

Informal Elements

Non-official, unofficial parts of a structure or system which may influence or affect its function.

Hawthorne Studies

Studies conducted during the 1920s and 1930s that suggested the importance of the informal organization.