Which of the Following Generally Occurs When a Central Bank

question 21

Multiple Choice

Which of the following generally occurs when a central bank pursues contractionary monetary policy?

• A) The central bank sells bonds and the interest rate increases.
• B) The central bank sells reserves and the interest rate increases.
• C) The central bank sells bonds and the interest rate decreases.
• D) The central bank purchases bonds and the interest rate decreases.
• E) The central bank purchases bonds and the interest rate increases.

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Definitions:

Conscious

Being aware of and responsive to one's surroundings; involves the awareness of thoughts, feelings, and sensations.

Freud

A reference to Sigmund Freud, an Austrian neurologist known for founding psychoanalysis, a method for treating psychopathology through dialogue between a patient and a psychoanalyst.

Striving for Superiority

A concept in psychology suggesting that a primary motivational force in humans is the pursuit of superiority or success in overcoming challenges.

Alfred Adler

An Austrian psychiatrist and founder of Adlerian psychology, emphasizing the importance of the feeling of inferiority in the development of personality.