Currently, Federal Reserve is fighting with inflation through the attempts of increasing interest rate. Explain what could happen to equity prices if people have following alternative expectation for the next 2 years in the face of rising interest rates

a) More decrease in overall supply of goods and services. 

b) Increase in overall supply of goods and services.

Answer rating: 100% (QA)

A The decrease in overall supply of goods and services due to rising interest rates will be negative ... View the full answer