To Try to Eliminate a Recessionary Gap the Fed Typically__________

question 55

Multiple Choice

To try to eliminate a recessionary gap the Fed typically__________ the money supply,and to try to eliminate an inflationary gap the Fed typically __________ the money supply.

• A) increases; decreases
• B) increases; increases
• C) decreases; increases
• D) decreases; decreases

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Definitions:

Yield To Maturity

The total return anticipated on a bond if the bond is held until it matures, incorporating both interest payments and the capital gain or loss due to the difference between the purchase price and the maturity value.

Semi-annually

Semi-annually refers to an event or action that occurs twice a year, typically every six months.

Coupon Rate

The interest rate that a bond issuer agrees to pay to the holder annually, expressed as a percentage of the bond's face value.