A Nominal GDP Rule Requires the Fed To

question 236

Multiple Choice

A nominal GDP rule requires the Fed to:

• A) keep the money supply constant.
• B) keep the rate of money growth constant.
• C) adjust the money supply enough to make up for changes in velocity.
• D) adjust interest rates in the opposite direction of real GDP growth.

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Definitions:

T-statistic

A statistic calculated from a sample of data used to conduct a t-test, which assesses whether there is a significant difference between the means of two datasets.

Type II Error

An error that occurs when a statistical test fails to reject a false null hypothesis, indicating a missed opportunity to detect an actual effect or difference.

Type I Error

The incorrect rejection of a true null hypothesis, also known as a "false positive".

Effect Size

A quantitative measure of the magnitude of the difference between groups or the strength of the relationship between variables in a statistical analysis.