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Suppose the economy is producing at the natural rate of output. An open market purchase of bonds by the Fed will cause ________ in real GDP the the short run and ________ in inflation in the short run,
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Suppose the economy is producing at the natural rate of output. An open market purchase of bonds by the Fed will cause ________ in real GDP the the short run and ________ in inflation in the short run, everything else held constant.

User Pansora Abhay
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Answer:

The correct answers that fills the gap are: an increase; an increase.

Step-by-step explanation:

Real GDP is based on one-year prices and allows a comparison of the production of a given country in different periods of time, by isolating changes in prices, perfectly reflecting net purchasing power, regardless of changes in Prices over time.

User Ofer Helman
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