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    Economic Principles
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    Exam 27: Monetary Policy and Interest Rates
  5. Question
    When an Economy Has Too Much Inflation, Then the Federal
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When an Economy Has Too Much Inflation, Then the Federal

Question 1

Question 1

Multiple Choice

When an economy has too much inflation, then the Federal Reserve will _____ the target interest rate in order to _____ aggregate demand.


A) increase; reduce
B) increase; increase
C) reduce; reduce
D) reduce; increase

Correct Answer:

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