In an Effort to Address the Troubled Economy

question 37

Multiple Choice

In an effort to address the troubled economy, ..."For the ninth time in just over a year, the Federal Reserve is expected to cut interest rates, quite possibly its last reduction in this downturn." Rates have not been this low "... since 2003, when the economy was growing at a snail's pace." www.csmonitor.com, 10/28/2008
The Fed's rates cuts will initially impact ________ and eventually ________.

• A) bank reserves; government spending
• B) the money supply; bank reserves
• C) bank reserves; real GDP
• D) investment; the real interest rate

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Definitions:

Companionate

Refers to love characterized by deep affection, friendship, and emotional intimacy, as opposed to passionate love.

Self-effacing Bias

The tendency to attribute success to external factors and failures to oneself, often observed in cultures that value modesty and collectivism.

Japanese Subjects

Individuals from Japan participating in a study or research project.

American Subjects

Refers to research participants who are from the United States, often noted in studies to discuss the cultural or demographic background of the sample.