If Planned Aggregate Spending in an Economy Can Be Written

question 56

Multiple Choice

If planned aggregate spending in an economy can be written as PAE = 15,000 + 0.6Y - 20,000r, and potential output equals 35,000, what real interest rate must the Federal Reserve set to bring the economy to full employment?

• A) 0.02
• B) 0.03
• C) 0.04
• D) 0.05

---

Definitions:

Customer Demand

The desire for products or services that customers are willing and able to purchase at a given price.

NSA

The National Security Agency, a U.S. government agency responsible for global monitoring, collection, and processing of information and data for foreign and domestic intelligence and counterintelligence purposes.

Public Cloud

A computing service model where resources, like servers and storage, are owned and operated by a provider and delivered over the Internet to multiple customers on a pay-per-use basis.

Grid Computing

A distributed computing model that uses a network of computers to work together, performing complex tasks by dividing them into smaller jobs.