A decrease in the federal funds rate leads to

Question

Quizplus · Accepted Answer

A decrease in the federal funds rate leads to a fall in the exchange rate because lower interest rates make domestic investments less attractive, causing a decrease in demand for the domestic currency.
An increase in exports occurs because a fall in the exchange rate makes domestic goods relatively cheaper for foreign buyers.
An increase in the quantity of money occurs because a decrease in the federal funds rate makes borrowing cheaper for banks, leading them to increase lending and increasing the money supply.

A Decrease in the Federal Funds Rate Leads to