If the Fed Has Fixed the Interest Rate

question 34

Multiple Choice

If the Fed has fixed the interest rate,

• A)it must conduct open market sales when money demand increases.
• B)the money demand will not change.
• C)money supply and money demand will not change.
• D)it must conduct open market sales when money demand decreases.
• E)the money supply will not change.

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Definitions:

Bystanders

People who are at a scene or occurrence yet do not participate.

Crisis Situation

A significant and often sudden event or condition that requires immediate attention and action to protect life, property, or the environment.

Pressure

The psychological experience produced by urgent demands or expectations for a person’s behavior that come from an outside source.

Norms

Shared expectations or rules that guide behavior within a group or society.