Which combination of signals would be a strong indication that Fed policy is too expansionary and that a shift to a more restrictive policy is in order?
A) commodity prices are falling and the dollar is appreciating.
B) commodity prices are rising and the dollar is depreciating.
C) commodity prices are rising and the dollar is appreciating.
D) commodity prices are falling and the dollar is depreciating.

Question

Quizplus · Accepted Answer

Rising commodity prices and a depreciating dollar suggest inflationary pressures and reduced purchasing power, indicating that monetary policy might be too loose and needs tightening.

Which Combination of Signals Would Be a Strong Indication That