The Fed Lowered Interest Rates in 2007 and 2008

question 2

Multiple Choice

The Fed lowered interest rates in 2007 and 2008.This implies,other things the same,that the Fed

• A)increased the money supply because it was concerned about unemployment.
• B)increased the money supply because it was concerned about inflation.
• C)decreased the money supply because it was concerned about unemployment.
• D)decreased the money supply because it was concerned about inflation.

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Definitions:

FOB

Free On Board, a term used in shipping to indicate who is responsible for payment of transportation and insurance.

Freight

The charge paid for the transportation of goods, typically by sea, air, or land.

Free

Not under the control or in the power of another; able to act or be done as one wishes, or without cost or payment.

Supplies Expense

An expense reported on the income statement that reflects the cost of supplies used during the reporting period.