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.

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter16: The Influence Of Monetary And Fiscal Policy On Aggregate Demand

Section: Chapter Questions

Problem 8PA

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