Answer: Say the Federal Reserve decides to reduce interest rates to stimulate economic growth. They do this by purchasing government securities over the open market with newly created money. The bank will take this new money and lend it out (or purchase securities, it doesn't matter due to arbitrage). This has the effect of increasing the supply of loanable funds, pushing down the interest rate.
Now just because the interest rate is lowered does not mean that the expansionary monetary policy will have its desired effect immediately. Lower interest rates encourage borrowing, and increased borrowing can increase employment, GDP, etc. There is a lag between the reduction in interest rates and its effects on the real economy. People will not respond to the lower interest rates by borrowing and hiring immediately; the effect can take 1-2 years.
Explanation:
Answer:
general intelligence
Explanation:
General intelligence refer to general cognitive ability of human mind to solve logical and reasoning problems, complex data problems and verbal reasoning test. This test is generally required after secondary school to get admission in high school. Its meant to test mental capacity to solve unseen reasoning questions.
