Suppose that the economy faces an inflationary GDP gap. Which of the following policies would be appropriate to close the gap? Fed can raise the price of the bond to sell more bonds to the consumers. O Fed can lower the price of the bond to sell more bonds to the consumers. Fed can raise the price of the bond to buy more bonds from the consumers. Fed can lower the price of the bond to buy more bonds from the consumers.

Suppose that the economy faces an inflationary GDP gap. Which of the following policies would be appropriate to close the gap? Fed can raise the price of the bond to sell more bonds to the consumers. O Fed can lower the price of the bond to sell more bonds to the consumers. Fed can raise the price of the bond to buy more bonds from the consumers. Fed can lower the price of the bond to buy more bonds from the consumers.

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter14: Macroeconomic Policy: Tradeoffs, Expectations, Credibility, And Sources Of Business Cycles

Section: Chapter Questions

Problem 11E

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