The Reserve Bank Increases Interest Rates to Reduce the Level

question 63

Multiple Choice

The Reserve Bank increases interest rates to reduce the level of spending in the economy.As the rate of growth in economic activity slows,the demand for funds also slows.This impact of a change in interest rates is described as the:

• A) inflation effect.
• B) liquidity effect.
• C) income effect.
• D) monetary effect.

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Definitions:

Emotion-focused Coping

Strategies aimed at managing the emotional response to a problem, rather than tackling the problem itself.

Heart Disease

Various heart-related disorders including diseases of the blood vessels, abnormalities in heart rhythm (arrhythmias), and congenital heart defects, among others.

Problem-focused Coping

A strategy to deal with stress by tackling the problem causing the stress directly.

Self-control

The power to oversee one's feelings, mentations, and behaviors whilst faced with allurements and instinctive drives.