If Inflation Is a Threat, Then the Fed Will Conduct

question 60

Multiple Choice

If inflation is a threat, then the Fed will conduct monetary policy aimed at _______ the interest rate which then will shift aggregate demand to the _______.

• A)increasing; right
• B)decreasing; right
• C)decreasing; left
• D)increasing; left

---

Definitions:

Satiety

The feeling of fullness or satisfaction that signifies the end of eating, regulated by hormonal signals in response to food intake.

Hypothalamus

A region of the brain responsible for producing hormones that regulate fundamental bodily functions, including temperature, hunger, and thirst.

Leptin

A hormone produced by fat cells that helps to regulate energy balance by inhibiting hunger.

Somatostatin

A hormone that inhibits the release of growth hormone from the anterior pituitary gland and also suppresses the release of various other hormones within the body's gastrointestinal system.