If Potential Output Equals 3,000 and Short-Run Equilibrium Output Equals

question 78

Multiple Choice

If potential output equals 3,000 and short-run equilibrium output equals 3,500, there is a(n) ________ gap and the Federal Reserve must ________ real interest rates in order to close the gap.

• A)recessionary; raise
• B)recessionary; reduce
• C)recessionary; not change
• D)expansionary; raise

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Definitions:

Acrochordons

Also known as skin tags, these are small, benign growths that typically form in areas where the skin folds or experiences friction.

Kaposi's Sarcoma

A type of cancer that causes patches of abnormal tissue to grow under the skin, in the lining of the mouth, nose, throat, and other organs; often associated with weakened immune systems.

Angiomas

Angiomas are benign tumors derived from blood vessels or lymph vessels, often appearing as red moles on the skin.

Measles

A highly contagious viral infection, characterized by fever, cough, and a distinctive rash.