If the Fed Wants to Fight Inflation, It Will_{--------------------}the Federal

question 20

Multiple Choice

If the Fed wants to fight inflation, it will_{--------------------}the federal funds rate in order to _{--------------------}

• A)raise; decrease aggregate supply
• B)raise; increase aggregate supply
• C)raise; decrease aggregate demand
• D)lower; decrease aggregate demand
• E)lower; increase aggregate supply

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Definitions:

Adjusting Entry

An accounting record made to allocate income and expenditures to the appropriate accounting periods.

Interest Payable

Accrued interest that a company owes to its creditors or on its debts but has not yet paid.

Interest Expense

The cost incurred by an entity for borrowed funds over a period of time.

Recurring Transaction

A transaction that occurs regularly, following a set schedule, such as monthly subscription payments.