Everything Else Held Constant,an Expansionary ________ Policy Will Cause the Interest

question 6

Multiple Choice

Everything else held constant,an expansionary ________ policy will cause the interest rate to rise,while an expansionary ________ policy will cause the interest rate to fall.

• A)monetary;monetary
• B)monetary;fiscal
• C)fiscal;monetary
• D)fiscal;fiscal

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Definitions:

Accrual Basis

An accounting method where revenues are recorded when earned, and expenses are recorded when incurred, regardless of when cash is exchanged.

Net Income

The net income of a business once all costs and taxes are subtracted from its total earnings.

Cash Basis

The cash basis is an accounting method where revenues and expenses are recognized only when cash is received or paid, as opposed to when they are incurred.

Adjusting Entries

Journal entries made in accounting records at the end of an accounting period to update the balances of certain accounts.