Based on the diagram, if potential output equals 5,000 and the real interest rate is 3 percent, then there is ________ gap and the Fed must ________ the real interest rate so that output will equal potential output. 
A. an expansionary; raise
B. no output; not change
C. a recessionary; raise
D. a recessionary; reduce
Answer: B
Economics
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Which of the following cost relationships is not true?
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