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:
Statements
The larger the federal deficit, other things held constant, the higher are interest rates.
Actions that lower short-term interest rates will always lower long-term interest rates.
Long-term interest rates are not as sensitive to booms and recessions as are short-term interest rates.
The Federal Reserve Board has a significant influence over the level of economic activity, inflation, Interest rates in the United States
