Which of the Following Would Lead the Fed to Increase

question 57

Multiple Choice

Which of the following would lead the Fed to increase the money supply under an interest rate rule?

• A) an unexplained decrease of money demand
• B) an increase in taxes
• C) a decrease in spending that caused the money demand curve to decrease
• D) an increase in spending that caused the money demand curve to increase
• E) a decrease in government spending.

---

Definitions:

Granular Cells

Cells that contain granules in their cytoplasm, which may store enzymes, hormones, or other substances involved in various biological processes.

Bicarbonate

A buffer that plays a vital role in maintaining the pH balance in the blood and other bodily fluids.

Pancreatic Juice

A liquid secreted by the pancreas that contains a variety of enzymes critical for the digestion of food in the small intestine.

Goblet Cells

Epithelial cells that secrete mucus to protect and lubricate many internal body surfaces.