If the Target Rate of Interest Is Higher Than the Equilibrium

question 76

Multiple Choice

If the target rate of interest is higher than the equilibrium interest rate, the Federal Reserve will _____ Treasury bills in the open market, _____ the supply of money, and _____ the interest rate to the target rate.

• A) sell; increase; lower
• B) buy; increase; lower
• C) sell; decrease; raise
• D) buy; decrease; raise

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Definitions:

Boundaries

Limits or borders that define the space within which actions occur or the extent of acceptable behavior.

Competence

Refers to the ability of an individual or organization to effectively perform or carry out a specific task or role.

Ethical Decision-making

The process of evaluating and choosing among alternatives in a manner consistent with ethical principles.

Moral Decision-making

The process of choosing the right or ethical course of action when faced with a moral dilemma.