Suppose there is an increase in aggregate demand. If the Fed wants to stabilize output it could buy bonds. However these purchases move the price level further from its original level. sell bonds. However these sales move the price level farther from its original level. sell bonds. These sales also move the price level closer to its original level. buy bonds. These purchases also move the price level closer to its original level.

Suppose there is an increase in aggregate demand. If the Fed wants to stabilize output it could buy bonds. However these purchases move the price level further from its original level. sell bonds. However these sales move the price level farther from its original level. sell bonds. These sales also move the price level closer to its original level. buy bonds. These purchases also move the price level closer to its original level.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Suppose there is an increase in aggregate demand. If the fed want to

Suppose there is an increase in aggregate demand. If the Fed wants to stabilize output it
could
buy bonds. However these purchases move the price level further from its
original level.
sell bonds. However these sales move the price level farther from its original
level.
sell bonds. These sales also move the price level closer to its original level.
buy bonds. These purchases also move the price level closer to its original
level.

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