Which of the following will increase interest rates in the short run?
A)An decrease in reserve requirements
B)Open-market sales by the Fed
C)A decrease in real GDP
D)A decrease in the price level

Question

Quizplus · Accepted Answer

Open-market sales by the Fed will decrease the money supply, leading to an increase in interest rates in the short run. A decrease in reserve requirements, a decrease in real GDP, and a decrease in the price level will not necessarily increase interest rates in the short run.

Which of the Following Will Increase Interest Rates in the Short