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If the unemployment rate is falling from 4 to 3%, while the inflation rate is...

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Finance

If the unemployment rate is falling from 4 to 3%, while the inflation rate is increasing to 5%, the Fed will most likely: Question options: not change much. increase the money supply. increase the target for the federal funds rate. decrease the target for the federal funds rate. decrease the inflation rate by setting a price ceiling.

not change much.

increase the money supply.

increase the target for the federal funds rate.

decrease the target for the federal funds rate.

decrease the inflation rate by setting a price ceiling.

When bond interest rates fall, the relative expected return on holding stocks goes ___, which means that stock demand and thereby stock prices will ___, leading to an ___ in people's wealth and therefore in spending. (Note that this is when interest rates actually fall, not when people expect interest rates to fall in the future.)

Question options:

down, decrease, decrease

up, increase, increase

up, decrease, decrease

down, increase, increase

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