Your Roommate Is Having Trouble Grasping How Monetary Policy Works

question 178

Multiple Choice

Your roommate is having trouble grasping how monetary policy works.Which of the following explanations could you use to correctly describe the mechanism by which the Fed can affect the economy through monetary policy? Increasing the money supply

• A)lowers the interest rate,and firms increase investment spending.
• B)causes people to spend more because they know prices will rise in the future.
• C)raises the interest rate and consumers decrease spending on durable goods.
• D)lowers the interest rate,raises the value of the dollar,lowers the prices of exports,and raises net exports.

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Definitions:

Organizational Countercultures

Subcultures within an organization that hold values, beliefs, or behaviors that are distinctly different from or opposed to the dominant organizational culture.

Ethical Conduct

Behavior that is in line with accepted principles of right and wrong, guiding professional and personal actions.

Enacted Values

The values and norms that are actually exhibited or converted into employee behavior in an organization.

Espoused Values

The values an organization or individual claims to hold, which may or may not align with their enacted behavior.