The Fed Announces That It Intends to Implement Policies to Increase

Multiple Choice

The Fed announces that it intends to implement policies to increase interest rates. Which of the following correctly identifies the most likely result of higher U.S. interest rates?

A) More money will flow into the United States from foreign investors.
B) The economy will experience an increase in business investment spending.
C) The value of the dollar will fall relative to other currencies.
D) The rate of inflation will increase.