-In the Above Figure, If We Begin at S₁ and the Fed

question 178

Multiple Choice

-In the above figure, if we begin at S₁ and the Fed sells bonds

• A)the price of bonds falls, and the interest rate rises.
• B)the price of bonds falls, and so does the interest rate.
• C)the price of bonds rises, and so does the interest rate.
• D)the price of bonds rises, and the interest rate falls.

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