In Order to Combat Inflation,the Fed Will ________ the Federal

question 29

Multiple Choice

In order to combat inflation,the Fed will ________ the federal funds rate thereby ________ the quantity of money.

• A) raise; increase
• B) lower; increase
• C) raise; decrease
• D) lower; decrease

---

Definitions:

Snow-clearing

The process of removing snow from surfaces, like roads and walkways, to make them accessible and safe.

Perfectly Competitive

A market structure characterized by many buyers and sellers, all of whom have complete information and the products offered are homogeneous.

Marginal Cost

is the extra cost incurred by producing one more unit of a product or service.

Fixed Cost

Costs that do not change with the level of production or output, such as rent, salaries, and loan payments.