In Figure 5-1 above, if the budget line is BB0 and the natural real GDP is $5300, the structural surplus or deficit is

Which of the following policy tools is directly controlled by the Trading Desk at the Federal Reserve Bank of New York?

A) the spread between the discount rate and the federal funds rate B) the spread between the federal funds rate and the interest rate on banks' required reserves C) open market sales and purchases D) the required reserve ratio

In the prosperity phase of the business cycle, aggregate demand increased raising the price level and employment. But later, in the aftermath of the prosperity phase, aggregate demand slackened so that the price level and employment fell. People who lost their jobs during this phase are considered to be part of the economy's

a. cyclical unemployment b. structural unemployment c. permanent unemployment d. frictional unemployment e. underemployment