What condition led the Fed to begin using quantitative easing?

A. Stagflation rendered open-market operations practically pointless because banks were neither buying nor selling bonds.
B. Unemployment and inflation were both rising quickly, rendering traditional monetary policy unusable.
C. Congress authorized the Fed to get involved in fiscal policy.
D. The Fed could no longer reduce interest rates.


Ans: D. The Fed could no longer reduce interest rates.

Economics

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When the federal government makes no attempt to take corrective action, markets return a recessed economy to full employment levels of production by

(a) laying off workers. (b) lowering wages. (c) dropping prices. (d) doing all of the above.

Economics

It is appropriate to use the supply-and-demand model in which of the following markets?

A) beer market B) car market C) wheat market D) market for breakfast cereal

Economics

Josh wants to go to the football game this weekend, but he has a paper due on Monday. It will take him the whole weekend to write the paper. Josh decides to stay home and work on the paper. According to the Scarcity Principle, the reason Josh doesn't go to the game is that:

A. going to the game won't be fun. B. Josh can't go the game and finish the paper. C. writing the paper is easier than going to the game. D. Josh prefers schoolwork to football games.

Economics

Real wages more accurately reflect the payment to labor because they are adjusted for the effects of inflation.

Answer the following statement true (T) or false (F)

Economics