The Reserve Bank is concerned about inflation and has ________ the cash rate.Due to substitution effects,other ________ interest rates will ________ almost immediately.

Question

Quizplus · Accepted Answer

When the Reserve Bank is concerned about inflation, it typically increases the cash rate to curb spending and borrowing. This leads to an increase in short-term interest rates almost immediately due to substitution effects.

The Reserve Bank Is Concerned About Inflation and Has ________