Twice each year, the Chair of the Federal Reserve Board of Governors is required to provide a report to Congress on the state of the economy. Read Alan Greenspan's February 2005 testimony.
- How does Greenspan characterize the overall state of the economy at the time of the report?
- Based on Greenspan's testimony, what changes did he perceive occurring in aggregate demand and supply during 2004 and early 2005?
- Based on this testimony, did Greenspan believe that the economy was operating at potential GDP, below potential GDP, or above potential GDP, in February 2005. Explain.