A Worldwide Recession Reduces the Amount of U

question 150

Multiple Choice

A worldwide recession reduces the amount of U.S. exports, and as a result, aggregate demand decreases. To move U.S. GDP back to potential GDP, the Fed should

• A) lower the federal funds rate.
• B) raise the federal funds rate.
• C) increase the government's budget deficit.
• D) decreasing the quantity of money of money.

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Definitions:

Domain Archaea

One of the three domains of life; contains prokaryotic cells that often live in extreme habitats and have unique genetic, biochemical, and physiological characteristics; its members are sometimes referred to as archaea.

Adapted

Modified to suit a new or specific environment or condition, often referring to organisms in biology.

Inductive Reasoning

Using specific observations and the process of logic and reasoning to arrive at general scientific principles.

Hypothesis

A hypothesis is a proposed explanation for a phenomenon, made as a starting point for further investigation, validation, or refutation through experimentation and observation.