c. Predict how each chanage will affect interest rates. Increase interest rates C. A financial crisis makes banks extremely reluctant to take on risky loans without charging an extremely high risk premium. E. The Federal Reserve raises the federal funds rate from 4% to 5%. Decrease interest rates Not affect interest rates A. The Chinese government eliminates the tariffs it charges on goods exported from the United States. B. The implementation of artificial intelligence in manufacturing has led to faster than expected productivity growth, which results in decreasing production costs. D. Businesses' confidence about the future of the economy falls, which leads them to scrap planned investment projects. F. The federal government cuts the corporate tax rate, a move applauded by business executives, who say that it will make more investment opportunities profitable.

c. Predict how each chanage will affect interest rates. Increase interest rates C. A financial crisis makes banks extremely reluctant to take on risky loans without charging an extremely high risk premium. E. The Federal Reserve raises the federal funds rate from 4% to 5%. Decrease interest rates Not affect interest rates A. The Chinese government eliminates the tariffs it charges on goods exported from the United States. B. The implementation of artificial intelligence in manufacturing has led to faster than expected productivity growth, which results in decreasing production costs. D. Businesses' confidence about the future of the economy falls, which leads them to scrap planned investment projects. F. The federal government cuts the corporate tax rate, a move applauded by business executives, who say that it will make more investment opportunities profitable.

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter31: Capital Markets

Section: Chapter Questions

Problem 1E

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