If the Fed's Objective Is to Stimulate the Economy,which of the Following

question 95

Multiple Choice

If the Fed's objective is to stimulate the economy,which of the following gives the correct sequence of events?

• A)The money supply increases,interest rates decrease,investment increases,and AD increases.
• B)The money supply increases,interest rates decrease,investment increases,and AS decreases.
• C)The money supply decreases,interest rates increase,investment decreases,and AD decreases.

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Definitions:

Crystals

Solid materials whose constituents, such as atoms, molecules, or ions, are arranged in a highly ordered microscopic structure.

Minerals

Naturally occurring inorganic substances with a definite chemical composition and crystalline structure, forming the building blocks of rocks.

Scratch Test

A method used to determine the relative hardness of minerals by scratching them with an object of known hardness or with other minerals.

Effervescence

The potential of a mineral to have a vigorous bubbling reaction when a drop of dilute hydrochloric acid (HCl) is placed on it.