Which of the Following Is NOT a Short-Run Effect of a Decrease

question 16

Multiple Choice

Which of the following is NOT a short-run effect of a decrease in the federal funds rate?

• A) Aggregate demand increases.
• B) Net exports increase.
• C) Aggregate supply increases.
• D) Inflation rate increases.

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Definitions:

Periodic Bond Interest Payments

The regular interest payments made to bondholders during the life of the bond.

Present Value

The immediate value assigned to a future sum of money or cash movements, based on a particular return rate.

Interest Period

The duration over which interest is calculated on a loan or investment, which could be monthly, quarterly, semiannually, or annually.

Bond Indenture

A legal document specifying the terms, conditions, and details of a bond issued by a corporation or government entity.