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    Macroeconomics Study Set 26
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    Exam 14: The Great Recession and the Short-Run Model
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    When an Economy Is in a Deflationary Spiral,and Nominal Interest
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When an Economy Is in a Deflationary Spiral,and Nominal Interest

Question 2

Question 2

Multiple Choice

When an economy is in a deflationary spiral,and nominal interest rates are close to zero,it may be necessary:


A) for the Fed to print money.
B) for the Fed to buy financial securities.
C) to use fiscal stimulus.
D) all of the above
E) c and a

Correct Answer:

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