chapter13quiz - If the economy is facing inflationary pressures the Feds will raise interest rates a higher interest rate consumption investment and

chapter13quiz - If the economy is facing inflationary...

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If the economy is facing inflationary pressures, the Feds will: raise interest rates a higher interest rate ____ consumption, investment, and _____ , which ___ aggregate demand. decrease, exports, decreases the twin goals of monetary policy are: economic growth with low unemployment and stable prices with moderate long term interest rates. the fed uses its tools to counteract:
booms and recessions loosening monetary policy causes interest rates to __ and consumption and investment to ___ fall, increase when current real output exceeds potential real output, the feds will __ interest rates in an effort to fight ___. increase, inflation. In the classiscal monetary transmission mechanism any change in ___ will bring about ___ M, a direct proportionate change in P.
the quantity theory equation of exchange states: M V=P Q Money Illusion: is the misperception that one is wealthier, it occurs when the money supply grows.

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