If There Is a Political Business Cycle and the Federal

question 36

Multiple Choice

If there is a political business cycle and the Federal Reserve supports the incumbent,then we should expect that prior to elections the Fed would

• A)raise interest rates to shift aggregate demand left.
• B)raise interest rates to shift aggregate demand right.
• C)reduce interest rates to shift aggregate demand left.
• D)reduce interest rates to shift aggregate demand right.

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Definitions:

Confidence Interval

A variety of data points, taken from sample statistics, with a high likelihood of encasing an unknown population trait's value.

Defective Systems

Refers to systems or products that fail to meet quality standards or performance expectations due to flaws or errors.

Population Mean

The average value of a characteristic in a population.

Confidence Interval

A spectrum of statistical indicators, sourced from a sample, predicted to involve the secret value of a population parameter.