Refer to the Graphs Above, in Which the Numbers in Parentheses

question 3

Multiple Choice

Refer to the graphs above, in which the numbers in parentheses near the AD₁, AD₂, and AD₃ labels indicate the level of investment spending associated with each curve, respectively. All numbers are in billions of dollars. The interest rate and the level of investment spending in the economy are at point D on the investment demand curve. To achieve the long-run goal of a noninflationary full-employment output Q_f in the economy, the Fed should try to:

• A) Decrease aggregate demand by increasing the interest rate from 2 to 4 percent
• B) Decrease aggregate demand by increasing the interest rate from 4 to 6 percent
• C) Increase aggregate demand by decreasing the interest rate from 4 to 2 percent
• D) Increase the level of investment spending from $120 billion to $150 billion

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Definitions:

Organizational Citizenship Behavior

Voluntary, discretionary behaviors exhibited by employees that are not directly recognized by the formal reward system but contribute to organizational effectiveness.

Collective Performance

Refers to the aggregated or combined outcomes and achievements of a group or team working together towards common objectives.

Power of Earning

The capacity to generate income or wealth through work, investments, or other economic activities.

Organizational Reward System

The mechanisms and structures within an organization designed to recognize and compensate employees for their contributions.