Question: Consider the following table: Year 2012 2013 Potential GDP $14.7 trillion $15.3 trillion Real GDP $14.7 trillion $15.4 trillion Actual real GDP: Potential real
Consider the following table: Year 2012 2013 Potential GDP $14.7 trillion $15.3 trillion Real GDP $14.7 trillion $15.4 trillion Actual real GDP: Potential real GDP: Price level: Unemployment: What can we expect from the Federal Reserve Bank if it seeks to move the economy in the direction of long-run macroeconomic equilibrium? A. The Fed will pursue a contractionary fiscal policy. B. The Fed will pursue an expansionary monetary policy. C. The Fed will pursue a contractionary monetary policy. D. The Fed will pursue an expansionary fiscal policy. If the Fed's policy is successful, what is the effect on the following indicators? Price Level 110 114
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In the given table we can see that the potential GDP increased from 147 trillion in 2012 to 153 tril... View full answer
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