Use the Following to Answer Questions

question 26

Multiple Choice

Use the following to answer questions .
Exhibit: Monetary Policy 2
-(Exhibit: Monetary Policy 2) By shifting the supply curve from S₁ to S₂, the Fed is attempting to

• A) expand the economy by increasing interest rates.
• B) contract the economy by increasing interest rates.
• C) contract the economy by decreasing interest rates.
• D) expand the economy by decreasing interest rates.

---

Definitions:

Retirement Plan

A financial strategy designed to provide individuals with income or assets to rely on after they have ceased working, often involving savings, investments, and other financial products.

Compounded Semi-annually

This refers to the practice of applying interest to an existing amount plus any accumulated interest twice yearly.

Monthly Mortgage

A regularly scheduled payment which includes principal and interest owed on a mortgage.

Loan Payment

A payment made to reduce the outstanding balance of a loan, often made on a monthly basis.