-In the Above Figure, the Economy Experiences a Decrease in Aggregate

question 175

Multiple Choice

-In the above figure, the economy experiences a decrease in aggregate demand so that the aggregate demand curve shifts from AD? to AD?. If the Fed wants to offset this change, it would ________.

• A) purchase government securities on the open market
• B) sell government securities on the open market
• C) lower taxes
• D) increase government expenditures

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Definitions:

P(x > a)

The probability that a random variable x will take a value greater than a specified number a.

P(x < a)

This notation represents the probability that a random variable x is less than some value a.

Random Variable

A variable whose values depend on outcomes of a random phenomenon.

P(x < a)

This denotes the probability that the random variable X takes on a value less than a specific value a.