Table 26-1 -Refer to Table 26-1. the Hypothetical Information in the Table

question 219

Multiple Choice

Table 26-1

-Refer to Table 26-1. 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:

Legislative Leaders

Elected officials who hold significant positions of authority within legislative bodies and play key roles in shaping and passing laws.

Policy Advocacy

The active, intentional efforts to influence policy decisions and political processes to achieve specific outcomes.

Powerless Groups

Communities or demographic groups that lack political or economic power and representation in society.

Clinicians

Healthcare professionals involved in the direct care and treatment of patients.