When the Fed Practices Contractionary Monetary Policy, the Interest Rate

question 103

Multiple Choice

When the Fed practices contractionary monetary policy, the interest rate goes:

• A) up, and the exchange rate will appreciate as a result.
• B) up, and the exchange rate will depreciate as a result.
• C) down, and the exchange rate will appreciate as a result.
• D) down, and the exchange rate will depreciate as a result.

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