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Question 148

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Use the following to answer questions .
Exhibit: The Bond Market Use the following to answer questions . Exhibit: The Bond Market -(Exhibit: The Bond Market) Suppose the Fed takes action that shifts the demand curve from D to D′, as illustrated in Panel (a) . What happens to the interest rate? A) It will increase. B) It will decrease. C) It remains unchanged. D) Short-term interest rates will decrease but long-term interest rates will increase.
-(Exhibit: The Bond Market) Suppose the Fed takes action that shifts the demand curve from D to D′, as illustrated in Panel (a) . What happens to the interest rate?


A) It will increase.
B) It will decrease.
C) It remains unchanged.
D) Short-term interest rates will decrease but long-term interest rates will increase.

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