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A Rise in the Federal Funds Rate

Question 177

Multiple Choice

A rise in the federal funds rate


A) raises the long-term real interest rate.
B) does not change the long-term real interest rate.
C) lowers the long-term real interest rate.
D) may raise or lower the long-term real interest rate, depending on whether the demand for loanable funds curve has a negative or a positive slope.

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