Negative effect on europe economy

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Reference no: EM131388324

Imagine that you are the chair of the Fed and see that Brexit and other events in Europe during this year will have a negative effect on Europe's economy: what policy would you carry out and why?

Increase interest rates, given that worse EU economy negatively affects our imports.

Increase interest rates, given that worse EU economy positively affects our imports.

Decrease interest rates, given that worse EU economy negatively affects our exports.

Nothing: EU has no effect on US aggregate demand.

Reference no: EM131388324

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