If the Fed Raises Its Target for the Federal Fund

question 134

Multiple Choice

If the Fed raises its target for the federal fund rate, this indicates

• A) the Fed is pursuing an expansionary monetary policy.
• B) the Fed is pursuing a contractionary monetary policy.
• C) the Fed is attempting to lower unemployment.
• D) the Fed is concerned that the growth in aggregate demand will exceed potential GDP.

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Definitions:

Anthropomorphism

The tendency to attribute human characteristics, such as motives, to other animal species.

Objectivity

The principle of being unbiased and impartial, ensuring personal feelings or opinions do not affect the representation of facts.

Dilution

A process of decreasing the concentration of a solute in solution, typically by adding more solvent.

Increased Vigilance

The heightened state of watchfulness and alertness to potential threats or dangers.