Since the early 1990s, the Fed has conducted monetary policy by setting a target for the
A) level of borrowed reserves.
B) monetary base.
C) federal funds rate.
D) inflation rate.
C
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Consider the above figure. At a price level of 150
A) total planned production exceeds total planned real expenditures. B) total planned real expenditures exceed total planned real production. C) the price level would rise. D) inventories of unsold goods decline.
In the mid-1980s the natural rate of unemployment in the U.S. was about __________ while at present it is about __________
a. 10%; 2.5% b. 6.5%; 4.5% c. 4.5%; 6.5% d. 6.5%; 6.2% e. 6.5%; 10.0%
In terms of gains from trade, why is it true that taxes cause deadweight losses?
The IS—LM model predicts that a temporary beneficial supply shock
A) increases output, national saving, and investment, but not the real interest rate. B) increases output, national saving, and the real interest rate, but not investment. C) increases the real interest rate, investment, and output, but not national saving. D) increases output, national saving, investment, and the real interest rate.