When the Federal Reserve increases the Federal Funds target rate, it achieves this target by
a. purchasing government bonds. This action will reduce investment and shift aggregate demand to the right.
b. purchasing government bonds. This action will increase investment and shift aggregate demand to the right.
c. selling government bonds. This action will reduce investment and shift aggregate demand to the left.
d. selling government bonds. This action will increase investment and shift aggregate demand to the left.
c
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Market income is
A) profit earned in factor markets. B) interest earned in factor markets. C) wages, interest, rent, and profit earned in factor markets. D) wages, interest, rent, and profit earned in factor markets plus cash payments made to households by government.
Are your total and marginal utility of ice cream schedules determined by the price of ice cream?
What will be an ideal response?
Suppose the nominal interest rate is 7 percent annually, and you deposit $1,000. Inflation in the economy throughout the year is 7 percent. At the end of the year, you have earned:
A. an increase in your purchasing power. B. no increase in your savings. C. no increase in your purchasing power. D. a decrease in your purchasing power.
Suppose consumers save 8 percent of their incomes. If the government collects 4 dollar in taxes from each taxpayer and invested it in infrastructure, total social investment will ________ per taxpayer.
A. increase by $ 4.32 B. increase by $3.68 C. increase by 32 cents D. decrease by 64 cents