Interest rates play a role in the valuation of any stock or bond. Interest rates<\/a> can affect how much investors, banks, businesses, and governments are willing to borrow, therefore affecting how much money is spent in the economy. Secondly, rising interest rates make certain "safer" investments like U.S. Treasuries an attractive alternative to stocks.<\/p>"
}
}
,
{
"@type": "Question",
"name": "How Is Market Fluctuation Managed through Fiscal or Monetary Policy?",
"acceptedAnswer": {
"@type": "Answer",
"text": " Monetary policy is the management of interest rates and the total supply of money in circulation and is monitored by the U.S. Federal Reserve<\/a>. Fiscal policies relate to the taxing and spending actions of governments. In the United States, the national fiscal policy<\/a> is determined by the executive and legislative branches of the government. <\/p>"
}
}
,
{
"@type": "Question",
"name": "What Is the Difference Between Inflation and Deflation?",
"acceptedAnswer": {
"@type": "Answer",
"text": " Inflation is a gradual loss of purchasing power that is reflected in a broad rise in prices for goods and services over time. Deflation causes the nominal costs of capital<\/a>, labor, goods, and services to fall, though their relative prices may be unchanged. Periods of deflation<\/a> most commonly occur after long periods of artificial monetary expansion. <\/p>"
}
}
]
} ] }
]