From the early 1980's through the 1990's,the nominal interest rate
A)fell because the Fed got inflation under control.
B)fell because the Fed let inflation get out of control.
C)rose because the Fed got inflation under control.
D)rose because the Fed let inflation get out of control.

Question

Quizplus · Accepted Answer

During the 1980s and 1990s, the nominal interest rate fell because the Fed successfully controlled inflation through policies aimed at reducing inflationary pressures in the economy. Lower inflation led to lower nominal interest rates as expectations for future price increases decreased. So, choice A is the correct answer.

From the Early 1980's Through the 1990's,the Nominal Interest Rate