The Central Bank raises the base interest rate to curb inflationary pressures. Which one of the following combinations is most likely to reduce the effectiveness of this contractionary monetary policy?
| Consumer confidence | Direct taxation | Credit availability | |
|---|---|---|---|
| A | Falling | Rising | Decreasing |
| B | Rising | Falling | Increasing |
| C | Falling | Falling | Increasing |
| D | Rising | Rising | Decreasing |
Consumer confidence: Falling; Direct taxation: Rising; Credit availability: Decreasing
Consumer confidence: Rising; Direct taxation: Falling; Credit availability: Increasing
Consumer confidence: Falling; Direct taxation: Falling; Credit availability: Increasing
Consumer confidence: Rising; Direct taxation: Rising; Credit availability: Decreasing
