When the Federal Reserve decreases the Federal Funds target rate, the lower rate is achieved through
a. sales of government bonds, which reduces interest rates and causes people to hold less money.
b. purchases of government bonds, which reduces interest rates and causes people to hold less money.
c. purchases of government bonds, which reduces interest rates and causes people to hold more money.
d. sales of government bonds, which reduces interest rates and causes people to hold more money.
c
You might also like to view...
The more inelastic the supply curve in a goods market, the smaller will be the deadweight loss from a per-unit tax in that market.
Answer the following statement true (T) or false (F)
Which of the following is an example of the bandwagon effect?
A) A larger cellphone consumer group makes a cellphone service more attractive. B) The more people use Facebook, the more attractive it is to consumers. C) With more broadband services, more high-definition webpages become available. D) All of the above.
A net capital inflow occurs in open economies where investment is:
A. higher than national savings. B. lower than national savings. C. equal to national savings. D. higher than national spending.
Which decade had the greatest growth in U.S. labor productivity?
a. 1870s b. 1920s c. 1940s d. 1960s