The Fed Eases Policy When It

question 6

Multiple Choice

The Fed eases policy when it

• A)decreases both the money growth and the federal funds rate.
• B)decreases the money growth and increases the federal funds rate.
• C)increases both the money growth and the federal funds rate.
• D)increases the money growth and decreases the federal funds rate.

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Definitions:

Unusual

Anything that is not common, ordinary, or expected; deviating from what is typical or normal.

Stereotype Inconsistent

Information or behavior that contradicts common stereotypes or generalizations about a group.

Prototype

An early sample or model of a product used to test a concept or process or to act as a thing to be replicated or learned from.

Cognitive Representation

The way in which knowledge and ideas are mentally structured and stored, influencing perception and understanding.