Table 15-1 -Refer to Table 15-1.The Hypothetical Information in the Table Shows

question 240

Multiple Choice

Table 15-1

-Refer to Table 15-1.The hypothetical information in the table shows what the values for real GDP and the price level will be in 2015 if the Fed does not use monetary policy.Which of the following policies makes sense if the Fed wants to keep real GDP at its potential level in 2015?

• A)The trading desk should sell Treasury securities.
• B)The Fed should lower the target for the federal funds rate.
• C)The Fed should pursue contractionary policy.
• D)The Fed should lower capital gains taxes.

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Definitions:

Cause in Fact

A legal doctrine determining whether the defendant's actions are the actual cause of the plaintiff's damage or injury.

Product Liability Suit

A legal action taken against a manufacturer, distributor, or seller for producing or selling a defective product that caused harm to a consumer.

Proximate Cause

The primary event or act that leads to a legal liability, directly resulting in the occurring damage or injury.

Strict Liability

A legal principle where a party can be held responsible for damages or harm caused without needing to prove negligence or intent.