Which of the Following Characterizes the Fed's Ability to Prevent

question 214

Multiple Choice

Which of the following characterizes the Fed's ability to prevent recessions?

• A)The Fed is able to "fine tune" the economy and entirely eliminate recessions.
• B)The Fed is incapable of changing aggregate demand through its monetary policy tools.
• C)The Fed is able to keep a recession shorter and milder than it would otherwise be.
• D)The Fed is able to eliminate the business cycle and achieve absolute price stability.

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Definitions:

Lens

A piece of transparent material with at least one curved surface, which refracts or focuses light rays.

Iris

The colored part of the eye surrounding the pupil that controls the amount of light entering the eye.

Pupil

The circular opening in the center of the eye that allows light to enter and reach the retina, adjusting in size to regulate the amount of light.

Cornea

The clear, protective outer layer of the eye that helps to focus incoming light.