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If the RBA Believes Inflation Will Rise to 7 Per

Question 92

Multiple Choice

If the RBA believes inflation will rise to 7 per cent over the next few months, its likely response will be to:


A) buy government securities from banks to decrease interest rates.
B) buy government securities from banks to increase interest rates.
C) sell government securities to banks to increase interest rates.
D) sell government securities to banks to decrease interest rates.

Correct Answer:

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