Attempts: Keep the Highest: 11 8. Macroeconomic factors that influence interest rate levels Apart from risk components, several macroeconomic factors-such as Federal Reserve (the Fed) policy, Federal budget deficit or surplus, international factors, and levels of business activity--Influence interest rates. Based on your understanding of the impact of macroeconomic factors, identify which of the following statements are true or false: True False . Statements The larger the federal deficit, other things held constant, the higher are interest rates. If the Fed injects a huge amount of money into the markets, inflation is expected to decline, and long-term interest rates are expected to rise During the credit crisis of 2008, investors around the world were fearful about the collapse of real estate markets, shaky stock markets, and liquidity of several securities in the United States and several other nations. The demand for US Treasury bonds Increased, which led to a rise in their price and a decline in their yields. The Federal Reserve's ability to use monetary policy to control economic activity in the United States is limited because US Interest rates are highly dependent on interest rates in other parts of the world. Grade It Now Save & Continue