QUESTION 2 2 points Answer The Federal Reserve\'s sale or purchase of government
ID: 1129806 • Letter: Q
Question
QUESTION 2 2 points Answer The Federal Reserve's sale or purchase of government bonds is referred to as. O open market operations o credit rationing monetarism quantitative easing QUESTION 3 2 points Save Answer Fiscal policy refers to Olabor market regulation. Ofinancial market regulation o government spending and tax policy o The Federal Reserve's policy QUESTION 4 2 points Save Answer According to the text, income () will be equal to aggregate demand (AD) only when.. O households do not save there is no government spending and no foreign sector. O actual business investment is equal to intended investment. O household saving is equal to imports QUESTION 5 2 points Save Answer Suppose the government increases spending by S200 million but at the same time increases taxes by $200 milon According to the macroeconomic model presented in the text, by how much would equilibrium output change? Output would increase by $400 million. o Output would increase by S200 million. Output would decrease by $200 million. O We don't have enough information to predict the change in output.Explanation / Answer
2)a) Open market operation.
3)c) government spending and tax policy .
4) c) actual business investment is equal to intended investment.
5) d) We don't have enough information to predict the change in output because if G increases then Y increases but T also reducec by same amout. So consumption also function of disposable income (Y-T). So C reduces.