Quiz on the Fed’s Interest Rate Cut

What was the target range for the federal funds rate after the Fed's interest rate cut?

• 4.5 to 4.75 percent

• 3.5 to 3.75 percent

• 5.0 to 5.25 percent

• 4.0 to 4.25 percent

How many basis points did the Fed lower the federal funds rate by?

• 75 basis points

• 25 basis points

• 50 basis points

• 100 basis points

What was the inflation rate in September before the Fed's rate cut?

• 2.4 percent

• 5.4 percent

• 3.4 percent

• 4.4 percent

Which type of loan is directly affected by changes in the federal funds rate?

• 10-year Treasury note

• Corporate bonds

• Fixed-rate mortgage

• Adjustable-rate mortgage

What is the average interest rate on personal loans as of October 30?

• 12.40 percent

• 10.40 percent

• 11.40 percent

• 9.38 percent

What is the relationship between the prime rate and variable-rate credit cards?

• Credit card rates are fixed

• Prime rate directly affects credit card rates

• Prime rate is always higher

• They are unrelated

What is the effect of low interest rates on stock investments?

• Stocks become less attractive

• Stocks become more attractive

• No effect on stocks

• Stocks become riskier

What should savers consider to maximize their earnings from interest?

• Keeping cash at home

• Investing in stocks

• Online banks or top credit unions

• Traditional banks

What is the impact of the Fed's rate cut on the U.S. federal government's borrowing costs?

• Doubles borrowing costs

• Increases borrowing costs

• Decreases borrowing costs

• No impact on borrowing costs

What is the expected trend for mortgage rates following the Fed's rate cut?

• Mortgage rates will double

• Mortgage rates will rise

• Mortgage rates will fall

• Mortgage rates will remain unchanged