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1-Interest rates and riskiness are inversely related. TRUE FALSE 2-The FOMC has instructed the FRBNY Trading Desk to sell $500 million in US Treasury securities.

1-Interest rates and riskiness are inversely related.

TRUE

FALSE

2-The FOMC has instructed the FRBNY Trading Desk to sell $500 million in US Treasury securities. How will this impact the equilibrium interest rate?

a-Equilibrium interest rate will increase

b-Equilibrium interest rate will decrease

c-Equilibrium interest rate will stay the same

d-Equilibrium interest rate will shift

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