-Refer to the Above Figure

question 63

Multiple Choice

-Refer to the above figure. Which panels could represent the situation if the Fed had engaged in open market operations?

• A) Panels A and B
• B) Panels A and C
• C) Panels B and C
• D) Panels C and D

---

Definitions:

Variable Costs

Expenses that vary directly with the level of production or sales volume, such as materials and labor.

Labor

Human effort, whether physical or mental, contributed to the production of goods and services.

Materials

The physical components used in the production of goods and services.

Fixed Costs

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums.