Which of the following prevented the Fed from reducing long-term real interest rates during the Financial Crisis of 2007-2009?
A) an increase in expected inflation
B) an increase in the risk premium
C) the collapse in the housing market
D) the failure of the federal funds rate to respond to monetary policy
B
Economics
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When future labor income falls in a small open economy, it causes the current account to ________ and investment to ________
A) fall; rise B) rise; remain unchanged C) fall; remain unchanged D) rise; rise
Economics
In the presence of asymmetric information, a piece-rate contract
A) achieves production efficiency. B) can lead to agents producing more output than would occur under a fixed-rent-paid-to-the-principal contract. C) is impossible to write. D) will result in the principal earning all of the profit.
Economics