The Interest Rate Is the Price Borrowers Pay to Borrow

question 116

Multiple Choice

The interest rate is the price borrowers pay to borrow money.Key interest rates are controlled by the Federal Reserve System.If the Federal Reserve acts to reduce interest rates, economists would expect the quantity of money supplied to

• A)increase.
• B)decrease.
• C)not change.
• D)Uncertain-economic theory has no answer to this question.

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