The FOMC is concerned about inflation and has_{--------------------} the federal funds rate. Due to substitution effects, other _{--------------------}interest rates will _{--------------------}almost immediately. A)decreased; short-term; decrease B)decreased; long-term; decrease C)increased; short-term; decrease D)increased; short-term; increase E)increased; long-term; increase

Question

Quizplus · Accepted Answer

When the FOMC increases the federal funds rate, short-term interest rates typically increase almost immediately due to the substitution effect.

The FOMC Is Concerned About Inflation and Has-------------------- the Federal

The FOMC Is Concerned About Inflation and Has_{--------------------} the Federal