If the Economy Is at Potential Output and the Fed

question 104

Multiple Choice

If the economy is at potential output and the Fed increases the money supply, in the SHORT run interest rates will likely:

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

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Definitions:

Factor Analysis

A statistical method used to describe variability among observed, correlated variables in terms of potentially lower number of unobserved variables called factors.

Big Five Personality Traits

Refers to five broad dimensions of personality used to describe human personality, including openness, conscientiousness, extraversion, agreeableness, and neuroticism.

Nomothetic

An approach in psychology that focuses on studying what we share with others, using statistical methods to derive general laws.

Idiographic

Pertaining to the study or approach focusing on the individual, often used in contrast to nomothetic approaches that focus on generalizations.