An Increase in the Interest Rate in the United States

question 320

Multiple Choice

An increase in the interest rate in the United States compared to the interest rate in Great Britain will

• A) increase the U.S. interest rate differential.
• B) increase the demand for pounds.
• C) shift the demand curve for dollars rightward.
• D) Both answers A and C are correct.

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Definitions:

Secured Perfected Creditor

A creditor who has taken the necessary legal steps to ensure their claim against a debtor's collateral is enforceable against other creditors.

After-Acquired Property

Property or assets that a debtor obtains after signing a contract that pledges all of the debtor's current and future assets as collateral for a loan.

Financing Statement

A document filed to give public notice to secured creditors about a debtor’s assets used as collateral, typically in connection with securing a loan.

Repossession

The process by which a creditor takes back property from the debtor when the debtor does not make payments due on the property.