If the Economy Starting at Full Employment Output Begins to Enter

question 91

Multiple Choice

If the economy starting at full employment output begins to enter into an expansion,one would expect Congress and the president to conduct:

• A) expansionary fiscal policy.
• B) expansionary monetary policy.
• C) contractionary fiscal policy.
• D) contractionary monetary policy.
• E) countercyclical monetary policy.

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Definitions:

Financial Statements

Formal records of the financial activities and condition of a business, entity, or individual, including balance sheet, income statement, and cash flow statement.

Acquisition Differential

The gap between what a company is bought for and the net market value of its recognizable assets and liabilities.

Joint Venture

A business entity created by two or more parties, generally characterized by shared ownership, shared returns and risks, and shared governance.

Retained Earnings

Accumulated net profits of a company not distributed as dividends but reinvested in the business or kept as a reserve.