Which of the Following Is NOT a Short- Run Effect

question 85

Multiple Choice

Which of the following is NOT a short- run effect of a decrease in the federal funds rate?

• A) Aggregate supply increases.
• B) Net exports increase.
• C) Aggregate demand increases.
• D) Inflation rate increases.

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Definitions:

Substitution

In law or economics, the act of replacing one party or element of a contract with another.

Rescission

The act of canceling or annulling a contract, returning the parties involved to their positions prior to the agreement.

Nominal Damages

Monetary damages awarded to a plaintiff in a very small amount, typically $1 to $5, to signify that the plaintiff has been wronged by the defendant even though the plaintiff suffered no compensable harm.

Actual Damages

Financial compensation awarded to a plaintiff to recover losses directly resulting from a defendant's actions.