If the Fed Is Worried About Inflation and Raises Interest

question 67

Multiple Choice

If the Fed is worried about inflation and raises interest rates, then in the short run

• A)the aggregate demand curve will shift to the left.
• B)the aggregate demand curve will shift to the left, and the inflation adjustment line will shift down because the target inflation rate has decreased.
• C)the inflation adjustment line will shift down because the target inflation rate has decreased.
• D)the inflation adjustment line will shift up because the target inflation rate has increased.
• E)the aggregate demand curve will shift to the right.

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Definitions:

Albert Mehrabian

A psychologist known for his theories on the relative importance of verbal and non-verbal messages in human communication.

Functions

In mathematics, a relation between a set of inputs and a set of permissible outputs, often defining what output is assigned to a particular input.

Gestures

Physical actions or movements of the body that express ideas, intentions, or feelings.

Displays

Devices or presentations used to show, exhibit, or present information or items visually.