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At time t-1, the central bank announces to the public that it will have to raise interest rates by 1% indefinitely, starting at time t.
At time t-1, the central bank announces to the public that it will have to raise interest rates by 1% indefinitely, starting at time t. At time t, firms report their current earnings results and 70% of them beat their forecast. Stock prices would likely __________ at time t-1 and ________ at time t.
fall, remain constant
fall, rise
not change, change ambiguously
rise, fall
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