When an economy has too much unemployment, then the Federal Reserve will _____ the target interest rate in order to _____ aggregate demand.

Name: When an economy has too much unemployment, then the Federal Reserve will _____ the target interest rate in order to _____ aggregate demand.
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Question

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The Federal Reserve will reduce the target interest rate to increase aggregate demand, as lower interest rates make borrowing cheaper, encouraging spending and investment.

When an Economy Has Too Much Unemployment, Then the Federal