Table 17-1 -Refer to Table 17-1

question 172

Multiple Choice

Table 17-1
$\begin{array}{|c|c|c|c|}\hline \text { Year } & \text { Potential Real GDP } & \text { Real GDP } & \text { Price Level } \\\hline 2018 & \$ 18.2 \text { trillion } & \$ 18.2 \text { trillion } & 145 \\\hline 2019 & 18.6 \text { trillion } & 18.5 \text { trillion } & 147 \\\hline\end{array}$
-Refer to Table 17-1.The hypothetical information in the table shows what the values for real GDP and the price level will be in 2019 if the Fed does not use monetary policy.Which of the following policies makes sense if the Fed wants to keep real GDP at its potential level in 2019?

• A) The trading desk should sell Treasury securities.
• B) The Fed should lower the target for the federal funds rate.
• C) The Fed should pursue contractionary policy.
• D) The Fed should lower capital gains taxes.

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Definitions:

Variability

The lack of consistency or the tendency to vary, especially in the context of supply chain, leading to challenges in predicting demand, lead times, and inventory levels.

Bullwhip Effect

A phenomenon in supply chains where small fluctuations in demand at the retail level cause progressively larger fluctuations in demand upstream, often leading to inefficiency and increased costs.

Lot Sizes

The quantity of goods processed, produced, purchased, or delivered in a single batch or order, affecting manufacturing efficiency and inventory management.

Operational Improvements

Enhancements or optimizations made to the processes and procedures of an organization to increase efficacy, efficiency, and overall performance.