If the Economy Is Experiencing High Rates of Inflation, the Fed

question 78

Multiple Choice

If the economy is experiencing high rates of inflation, the Fed would likely respond by

• A)aggressively raising interest rates.
• B)aggressively lowering interest rates.
• C)keeping interest rates at the same level.
• D)passing a budget with larger individual and corporate tax cuts.

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Definitions:

Executive Agency

A part of the government under the executive branch, responsible for enforcing laws and regulations within specific areas.

Iron Triangle

A term describing the policy-making relationship among the congressional committees, the bureaucracy, and interest groups.

Lobbying

The act of attempting to influence the decisions of legislators and officials in the government, often by special interest groups or lobbyists representing business, labor, or other entities.

Adverse Legislation

Legislation that is considered unfavorable or detrimental to the interests of a specific group or the public.