Short-term interest rates tend to be ____ sensitive to business cycle changes than are long-term interest rates.
A) More
B) Less
C) Equally
D) More sensitive in a boom and less sensitive in a recession
E) More sensitive in a recession and less sensitive in a boom

Question

Quizplus · Accepted Answer

Short-term interest rates are more sensitive to business cycle changes because they are more directly influenced by monetary policy actions, which central banks adjust in response to economic conditions.

Short-Term Interest Rates Tend to Be ____ Sensitive to Business