What is likely to happen to interest rates if the central bank decides to decrease the money supply? A. Interest rates will increase. B. Interest rates will decrease. C. Interest rates will remain unchanged. D. Interest rates will initially decrease, then increase.

What is likely to happen to interest rates if the central bank decides to decrease the money supply? A. Interest rates will increase. B. Interest rates will decrease. C. Interest rates will remain unchanged. D. Interest rates will initially decrease, then increase.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

What is likely to happen to interest rates if
the central bank decides to decrease the
money supply?
A. Interest rates will increase.
B. Interest rates will decrease.
C. Interest rates will remain unchanged.
D. Interest rates will initially decrease, then
increase.

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