Which of the following results is NOT expected when the Federal Reserve lowers its federal funds target rate?
A) increased investment
B) increased consumption of durable goods
C) decreased exports
D) decreased imports

Question

Quizplus · Accepted Answer

Lowering the federal funds target rate is a monetary policy tool used to stimulate the economy by encouraging borrowing and spending. Lower interest rates can lead to increased investment and increased consumption of durable goods. However, lower interest rates can also lead to a weaker currency, making exports more attractive and increasing demand for them, leading to increased exports. Additionally, a weaker currency can make imports more expensive, leading to decreased imports. Therefore, the one result that is not expected when the Federal Reserve lowers its federal funds target rate is decreased exports.

Which of the Following Results Is NOT Expected When the Federal