If the Economy Is at Potential Output and the Fed

question 152

Multiple Choice

If the economy is at potential output and the Fed increases the money supply, in the LONG run real GDP will likely:

• A)fluctuate randomly.
• B)remain the same.
• C)decrease.
• D)increase.

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Definitions:

Total Stockholders' Equity

The total value of a company owned by its shareholders, calculated as the sum of share capital and retained earnings minus treasury shares.

Mars Corporation

An international manufacturer known for its confectionery products, pet food, and other food products and services.

Dividend Yield Ratio

A financial metric indicating the amount of dividend expressed as a percentage of a current share price.

Common Stock

A type of equity security that represents ownership in a corporation, giving shareholders voting rights and a share in the company’s profits through dividends.