In 1981 Fed policy created a severe recession because the Fed
A) publicly announced an inflation increase program.
B) undertook an unexpected increase in the inflation rate.
C) undertook an unexpected reduction in the inflation rate.
D) publicly announced an inflation reduction program.
E) increased aggregate supply to reduce the inflation rate.
Question 2
The difference between consumption and capital goods is that
A) only big corporations can afford capital goods.
B) capital goods are used to produce additional goods while consumption goods are not.
C) capital goods are provided by the government.
D) consumption goods can be enjoyed by many people at the same time.
E) it is illegal to export capital goods.
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