In the circular-flow diagram, households and firms are the decision makers

A decrease in the inflation rate will lead to a ________ nominal interest rate, which will ________ the debt-to-GDP ratio

A) higher; raise B) higher; reduce C) lower; raise D) lower; reduce

The Federal Reserve is anticipating a contractionary period in the economy. The Fed decides to engage in open market operations to stimulate the economy. This action is

A) active policy making. B) passive policy making. C) the monetary rule. D) Phillips policy making.