The Fed changes the federal funds rate using open-market operations.

According to the Application, economist John B. Taylor found that the temporary tax cuts which were a part of the 2009 stimulus package

A) were primarily used to pay off home mortgage balances. B) were split very evenly between consumption spending and household saving. C) were very successful in stimulating consumption spending. D) did very little to stimulate consumption spending.

If firms' inventories exceed their planned inventories, firms

A) increase employment. B) increase GDP. C) increase production. D) increase income. E) decrease production.