Assume a Central Bank Follows a Rule That Requires It

question 23

Multiple Choice

Assume a central bank follows a rule that requires it to take steps to keep the price level constant.If the price level rose because of an increase in aggregate demand and a decrease in aggregate supply that kept output unchanged,then

• A)the central bank would have to decrease the money supply which would decrease output.
• B)the central bank would have to decrease the money supply which would increase output.
• C)the central bank would have to increase the money supply which would decrease output.
• D)the central bank would have to increase the money supply which would increase output.

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Definitions:

DNA

The molecule that carries genetic instructions for the development, functioning, growth, and reproduction of all known living organisms.

Proteins

Large, complex molecules essential to the structure, function, and regulation of the body's cells, tissues, and organs.

Human Genome

Describes the complete set of nucleic acid sequences for humans, encoded as DNA within the 23 chromosome pairs in cell nuclei and in a small DNA molecule found within individual mitochondria.

Genes

Units of heredity made up of DNA that determine characteristics of living organisms.