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The central bank of a country decides to increase interest rates. What are the two most likely immediate effects of this decision on the economy?
The central bank of a country decides to increase interest rates. What are the two most likely immediate effects of this decision on the economy? (You will get 50% of the mark for each correct choice, and -33.33% of the mark for each incorrect answer). Question 5Answer a. Reduction in inflationary pressures. b. Decreased cost of borrowing for consumers and businesses. c. Increased foreign investment due to higher yields. d. Increase in savings rate due to higher returns on deposits. e. Rapid growth in the housing market
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