Which of the following is NOT a short-run effect of a decrease in the federal funds rate?

Question

Quizplus · Accepted Answer

A decrease in the federal funds rate typically leads to lower interest rates overall, which can stimulate borrowing and spending. This can increase aggregate demand (A) and potentially lower the value of the currency, making exports cheaper and thus increasing net exports (B). It can also lead to higher inflation (D) due to increased demand. However, it does not directly affect aggregate supply (C) in the short run, as aggregate supply is more influenced by factors like production costs and technology.

Which of the Following Is NOT a Short-Run Effect of a Decrease