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The Interest Rate Is the Price Borrowers Pay to Borrow

Question 171

Multiple Choice

The interest rate is the price borrowers pay to borrow money.Key interest rates are controlled by the Federal Reserve System.If the Federal Reserve acts to reduce interest rates, economists would expect the demand for money to


A) increase.
B) decrease.
C) not change.
D) be influenced by the interest rate, but with an uncertain effect.

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