Which Result Is NOT Expected When the Federal Reserve Lowers

question 260

Multiple Choice

Which result is NOT expected when the Federal Reserve lowers its federal funds target rate?

• A) increased investment
• B) increased consumption of durable goods
• C) decreased exports
• D) decreased imports

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Definitions:

Firms

Business entities or organizations that produce goods or provide services with the aim of earning profits.

Opportunity Cost

The expense incurred by not selecting the next most favorable option when deciding or opting for one action instead of another.

Hourly Wage

The amount of money paid to an employee for one hour of work.

Leisure

Time free from work or duties, which can be used for relaxation, hobbies, or cultural activities.