The linkages of the interest-rate-based transmission mechanism of monetary policy are summarized as follows:
A. change in the money supply ? change in interest rates ? change in transactions balances ? change in government spending ? change in aggregate demand.
B. change in the money supply ? change in speculative balances ? change in transactions balances ? change in planned investment ? change in aggregate demand.
C. change in the money supply ? change in planned investment ? change in government spending ? change in aggregate demand.
D. change in the money supply ? change in interest rates ? change in planned investment ? change in aggregate demand.
Answer: D
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A) falls; less; fall B) falls; less; rise C) falls; more; fall D) rises; less; fall
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A) zoning issues B) Federal employee taxes C) traffic regulations involving large trucks D) real estate values
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A. a necessity. B. a large portion of one's budget. C. a luxury. D. an inferior good.