A Monetary Growth Rule Means That

question 7

Multiple Choice

A monetary growth rule means that

• A)the Fed will lower interest rates if it thinks a recession is on the horizon.
• B)the Fed will raise interest rates if it thinks the economy is growing faster than potential.
• C)the money supply should grow at a constant rate.
• D)the money supply should grow in response to economic conditions.

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Definitions:

Class Inclusion

A cognitive ability that involves understanding that objects can belong to more than one category at the same time.

Conservation Skills

Cognitive abilities to understand that quantity, length, or number do not change when nothing is added or taken away, despite changes in form or appearance.

Centration

A cognitive limitation in preoperational stage children where they can focus on only one aspect of a situation at a time.

Reversibility

The cognitive ability to understand that actions can be reversed, restoring the original state.