Having a precommitment strategy gives the Fed the ability to alter the Fed funds rate when needed.
Answer the following statement true (T) or false (F)
False
Once the Fed has decided to undertake a precommitment strategy, they are less likely to make any changes that would deviate from this strategy; thus, a fear is that the Fed cannot reverse its stance on the funds rate if the economy starts to experience inflationary pressures or faster-than-expected growth.
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A monopolist is the sole supplier of a good or service for which there are no close substitutes
Indicate whether the statement is true or false
Which of the following tax changes would a supply-side economist be most likely to favor?
a. eliminating an investment tax credit b. an increase in the capital gain tax c. lower marginal income tax rates d. an increase in the personal income tax rate for high-income individuals
In a competitive market, the market demand is Qd = 60 - 6P and the market supply is Qs = 4P. A price ceiling of $3 will result in a
A. shortage of 15 units. B. surplus of 30 units. C. surplus of 12 units. D. shortage of 30 units.
With each 99 cent iTunes download, GDP
A) rises by 99 cents. B) falls by 99 cents. C) remains unchanged. D) is impossible to measure with this sale because nothing physical has been produced.