Question

Multiple Choice Question: To reduce US inflation, the FED indirectly intervenes by: a. Weakening the value...

Multiple Choice Question:
To reduce US inflation, the FED indirectly intervenes by:
a. Weakening the value of the USD versus other currencies
b. Weakening the value of the other currencies versus the USD
c. Reducing US interest rates
d. Increasing US interest rates
0 0
Add a comment Improve this question Transcribed image text
Answer #1

By increasing interest rates cost of funds become expensive causing people to borrow less the spend reducing demand in the economy. It also entices public to save more to get more interest and thus spend less reducing demand

Add a comment
Know the answer?
Add Answer to:
Multiple Choice Question: To reduce US inflation, the FED indirectly intervenes by: a. Weakening the value...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • Disinflation is the term for a period during which overall inflation rates are: Multiple Choice positive...

    Disinflation is the term for a period during which overall inflation rates are: Multiple Choice positive and falling. positive and increasing. zero. negative. If inflation was zero percent, nominal interest rates would be: Multiple Choice equal to real interest rate. larger than real interest. at the optimal rate. smaller than real interest. The net result of deflation is to: Multiple Choice reduce the level of aggregate supply in the economy. increase the level of aggregate demand in the economy. reduce...

  • Question 20(Multiple Choice Worth 1 points) If nominal interest rate equals 12 percent and inflation is...

    Question 20(Multiple Choice Worth 1 points) If nominal interest rate equals 12 percent and inflation is 4 percent, then nominal and real interest rates are respectively 12 percent and 8 percent. 12 percent and 16 percent. 16 percent and 8 percent. 16 percent and 12 percent. 8 percent and 4 percent. Question 21(Multiple Choice Worth 1 points) If the workforce is paid more frequently, then real output will decrease. the money supply will increase. price level will decrease. velocity of...

  • Question 12 (5 points) The Government's fiscal policy options for ending severe demand-pull inflation include: a)...

    Question 12 (5 points) The Government's fiscal policy options for ending severe demand-pull inflation include: a) Reducing government spending, increasing interest rates, or both. b) Increasing interest rates, reducing government spending, or both. c) Buying bonds on the open market. d) Increasing taxes, raising interest rates, or both. e) Reducing government spending, increasing taxes, or both.

  • 23. Fed Raises Rates As Job Gains, Firming Inflation Stoke Confidence The US. Wed Federal Reserve...

    23. Fed Raises Rates As Job Gains, Firming Inflation Stoke Confidence The US. Wed Federal Reserve raised interest rates on nesday. The rate rise was the second in three months. This second rise comes in an economy that is growing faster and creating jobs at a more rapid pace. These gains are accompanied by a ris- ing inflation rate. Source: Reuters, March 15, 2017 a. Describe the process by which the Fed's action reported in the news clip flows through...

  • 1. Treasury inflation-indexed bonds reduce investors' inflation risk by increasing the bond's when the consumer price...

    1. Treasury inflation-indexed bonds reduce investors' inflation risk by increasing the bond's when the consumer price index rises. a) Principal b) Coupon rate c) Term to Maturity d) Interest Rate 2. Historically, the primary policy tool used by the Fed to meet its monetary policy goals is a) Conducting open market operations b) Changing the discount Rate c) Changing reserve requirements d) Changing bank regulations 3. The value of Euro changed from $1.15 to $1.25. We can say that the...

  • If the Fed was trying to reduce demand-pull inflation, it might

    If the Fed was trying to reduce demand-pull inflation, it might A. sell government securities, lower reserve requirements and lower the discount rate. B. sell government securities, raise reserve requirements and raise the discount rate. C. sell government securities, lower reserve requirements and raise the discount rate. D. buy government securities, lower reserve requirements and raise the discount rate. 

  • Question 1: Part 1. When the US dollar appreciated against other global currencies which one of...

    Question 1: Part 1. When the US dollar appreciated against other global currencies which one of the following happened as the dollar got stronger: A. US economy became more competitive with the rest of the world B. It weakened the Japanese auto industry as more US cars were sold in Japan C. It injured the US textile industry, and helped drive it overseas D. It provided an improvement in the US balance of trade Part 2. Which one of the...

  • When the Fed changes monetary policy to reduce the rate of inflation, which of the following...

    When the Fed changes monetary policy to reduce the rate of inflation, which of the following should occur in the medium run? (A) The AD curve should shift to the right. (B) The IA line should shift down. (C) The AD curve should shift to the left. (D) The IA line should shift up.

  • QUESTION 21 Controversy 14 Multiple-Choice Items Which statement about caffeine is true? a. Caffeine can reduce...

    QUESTION 21 Controversy 14 Multiple-Choice Items Which statement about caffeine is true? a. Caffeine can reduce blood pressure b.Caffeine may slow down bone loss in women. Oc. Men who drink coffee have a higher risk of developing gallbladder disease. Od. Caffeinated beverages can contribute to daily fluid intakes. e. Large doses of caffeine have been shown to increase incidence of cancer QUESTION 34 Comprehension-Level Multiple-Choice Items Kwashiorkor and marasmus: □ a. result from inadequate diets. b. cause serious birth defects....

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT