If the Fed Pushes Interest Rates Lower,policymakers at Other Nations

question 133

Multiple Choice

If the Fed pushes interest rates lower,policymakers at other nations' central banks will most likely ________.

• A)follow suit,and drop their rates as well
• B)increase their rates
• C)do nothing;the Fed's actions have no influence on other countries' central banks
• D)keep their rates the same because a drop in U.S.rates will help their economy

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Definitions:

Present Value

The worth today of a future amount of money or sequence of cash inflows, based on a defined rate of return.

Accumulated Compound Interest

The total amount of interest earned or paid on a principal sum over multiple periods, where each period's interest is added to the principal for future calculations.

Annuity

A series of equal dollar amounts to be paid or received at evenly spaced time intervals (periodically).

Compounded Quarterly

Interest calculation on an investment or loan that is applied four times a year.