If the Fed Wishes to Increase Nominal Interest Rates, It

question 2

Multiple Choice

If the Fed wishes to increase nominal interest rates, it must engage in an open market ________ of bonds that ________ the money supply.

• A)sale; increases
• B)sale; decreases
• C)sale; does not change
• D)purchase; increases

---

Definitions:

Electra Complex

A psychoanalytic theory introduced by Carl Jung, positing that a girl’s psychosexual competition with her mother for possession of her father.

Nonidentical Twins

Twins that develop from two different eggs fertilized by two different sperm, resulting in siblings that are genetically distinct, also known as fraternal twins.

Unconscious Conflict

Psychological struggles within the mind that occur without conscious awareness, often influencing behavior and emotions.

Anxiety

A feeling of worry, nervousness, or unease about something with an uncertain outcome, often reflecting a response to stress or threat.