If the Fed Has a Strong Preference for Stable Prices

question 172

Multiple Choice

If the Fed has a strong preference for stable prices relative to output, it responds to a price ________ with a ________ increase in the interest rate.

• A) increase; large
• B) increase; small
• C) decrease; large
• D) decrease; small

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Definitions:

Distal Convoluted Tubule

The segment of the nephron in the kidney where final adjustments in urine composition are made, crucial for regulating blood pressure and electrolyte balance.

Proximal Convoluted Tubule

A segment of the nephron in the kidney where a major portion of the reabsorption of water, ions, and all organic nutrients occurs.

Bowman Capsule

A cup-like sac at the beginning of the tubular component of a nephron in the kidney that performs the first step in the filtration of blood to form urine.

Loop of Henle

A segment of the nephron in the kidney crucial for concentrating urine and conserving water.