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    Principles of Economics Study Set 6
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    Exam 26: Monetary Policy and the Fed
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    If the Economy Experiences an Inflationary Gap, a Contractionary Monetary
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If the Economy Experiences an Inflationary Gap, a Contractionary Monetary

Question 71

Question 71

Multiple Choice

If the economy experiences an inflationary gap, a contractionary monetary policy will _______ interest rates and _______ the bond prices.


A) increase; increase
B) increase; decrease
C) decrease; increase
D) decrease; decrease

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