Multiple Choice
If the stock market booms
A) household spending increases.To offset the effects of this on the price level and real GDP, the Fed would increase the money supply.
B) household spending increases.To offset the effects of this on the price level and real GDP, the Fed would decrease the money supply.
C) household spending decreases.To offset the effects of this on the price level and real GDP, the Fed would increase the money supply.
D) household spending decreases.To offset the effects of this on the price level and real GDP, the Fed would decrease the money supply.
Correct Answer:
Verified
Correct Answer:
Verified
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