Answer to Question #102954 in Macroeconomics for Michael

Question

If the inflation rate were above the target, it would be appropriate for the South African Reserve Bank to..........

1. Buy government bonds
2. Lower the interest rates level
3. Increase the quantity of money
4. Increase the interest rate level

B. If the South African Reserve Bank wants to decrease the money supply growth to curb inflation, it may.......

1. Increase income tax rates
2. Increase the repo rate
3. Buy treasury bills in the open market
4. Buy government bonds

Answer 1

A-4

B-1