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If the Fed Believes There Has Been a Positive Wealth

Question 167

Multiple Choice

If the Fed believes there has been a positive wealth effect, it will want to


A) raise interest rates to reduce inflationary pressure.
B) raise interest rates to reduce prices.
C) lower interest rates to increase potential GDP.
D) lower interest rates to offset the increase in wealth.
E) raise interest rates to encourage saving and investment.

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