Which monetary policy tool do central banks now turn to when target rates approach zero?

1. A. quantitative easing
2. B. raising the discount rate
3. C. issuing government bonds
4. raising reserve requirements

The circular flow model captures the total ___________________ of an economy.

1. income
2. output
3. neither income nor output.
4. both income and output

From an initial long-run macroeconomic equilibrium, if the Federal Reserve anticipated that next year aggregate demand would grow significantly faster than long-run aggregate supply, then the Federal Reserve would most likely:

1. decrease income tax rates.
2. increase income tax rates.
3. decrease target interest rates.
4. increase target interest rates.