Having Interest Rate Stability

question 102

Multiple Choice

Having interest rate stability

• A)allows for less uncertainty about future planning.
• B)leads to demands to curtail the Fed's power.
• C)guarantees full employment.
• D)leads to problems in financial markets.

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Definitions:

Inelastic

A characteristic of a good where its demand does not significantly change with changes in price.

Percentage Change

A mathematical calculation that describes the relative change between an old value and a new value, expressed as a percentage.

Unit Elastic

A situation in demand or supply where a change in price leads to an equal proportionate change in quantity demanded or supplied.

Approximately Unit Elastic

A situation in economics where the percentage change in quantity demanded is roughly equal to the percentage change in price, indicating an elasticity of demand close to one.