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Aggregate Demand and Supply Analysis

question 85

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Aggregate Demand and Supply Analysis Aggregate Demand and Supply Analysis   -In the figure above,assume that output is $10.5 trillion,while potential output is $12 trillion.If autonomous monetary policy (alone) is used to bring output to $12 trillion,then the figure implies that the real interest rate will be ________ percent,and the inflation rate will be one percent. A) 1.5 B) zero C) one D) 0.5 E) 2.5
-In the figure above,assume that output is $10.5 trillion,while potential output is $12 trillion.If autonomous monetary policy (alone) is used to bring output to $12 trillion,then the figure implies that the real interest rate will be ________ percent,and the inflation rate will be one percent.


Definitions:

S&P 500 Index Futures

Financial contracts to buy or sell the Standard & Poor's 500 Index at a future date, used for hedging or speculative purposes.

Overpriced

A situation where a security or asset is trading at a price higher than its intrinsic value or fair value.

Sell

To transfer ownership of a security or other asset in exchange for money or value.

Stocks

Shares of ownership in a company that entitle the shareholder to a proportion of the company's profits and assets.

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