To increase equilibrium national income, the Fed could

Question

Quizplus · Accepted Answer

The best choice to increase equilibrium national income would be for the Fed to purchase government bonds. This is known as open market operations and typically leads to an increase in the money supply, which can increase spending and ultimately, national income. The other options listed may have different effects on the economy, but are less likely to directly impact equilibrium national income.

To Increase Equilibrium National Income, the Fed Could