The economy pictured in the figure below has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________.  

Which of the following statements is FALSE?

A) Both monetary and interest rate targets cannot be pursued simultaneously. B) A reduction in the required reserve ratio increases the money supply and pushes down the equilibrium interest rate. C) An open market purchase reduces the money supply and pushes down the equilibrium interest rate. D) An open market sale decreases the money supply and pushes up the equilibrium interest rate.

If Jenna buys a CD at a price of $10, she gets a consumer surplus of $20 . This means she

a. does not have enough money to buy the CD b. will not buy the CD since marginal utility is not high enough c. was willing to pay as much as $30 for the CD d. was willing to pay as much as $20 for the CD e. will have $30 left over after she buys the CD