If the Fed Raises Its Target for the Federal Fund

question 191

Multiple Choice

If the Fed raises its target for the federal fund rate,this indicates that

• A)the Fed is pursuing an expansionary monetary policy.
• B)the Fed is pursuing a contractionary monetary policy.
• C)the Fed is attempting to combat deflation.
• D)The Fed is concerned that the growth in aggregate demand is too slow to keep up with potential GDP.

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