Answer:
C) The Fed can increase the equilibrium federal funds rate by decreasing the supply of reserves.
Explanation:
The Federal fund rate is the interest rate at which the banks use to lend money to each other overnight. It can simply be called the interest rate for interbank reserve loans. It can also be the interest rate which is used to conduct monetary policies.
Here, money demanded is equal to the amount of money supplied. The Fed can change the equilibrum funds rate by decreasing the money supplied to the banks, which in turn, makes the federal fund demand increase and the federal also fund rate increases.
Loan financing problems and bad reputation to financial companies
Answer:
B) The SRAS curve will shift to the right, and the short‐run Phillips curve will shift downward.
Explanation:
When the price of key inputs decreases, then the short-run aggregate supply (SRAS) curve shifts to the right, generally resulting in higher production levels (higher supply) due to lower production costs. On the other hand, when the price of key inputs increases, then the SRAS curve shifts to the left.
When inflation expectations decrease or SRAS curve shifts to the right, the short-run Phillips curve shifts to the left.
D. Resourcefulness; if you can pick more than one than also chose A. Confidence.
