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Chapter 5, Problem 13Q
To determine

The effect on interest rates if the public believes in the president of the United States announcing that he will fight the higher inflation rate with the new anti-inflation program..

Concept Introduction:

Whenever a country faces acute rising prices and income distortions, there is always a relentless need for an anti inflation policy. This could be in the form of government restraints, voluntary wage and price controls. The government must intervene to bring stability to affordability.

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