Assume that the Federal Reserve replaces the money stock with the interest rate as an intermediate target.Then,
A) the range for the target interest rate would be chosen to hit the inflation rate,unemployment rate,and growth rate of the economy.
B) if the Treasury bill rate fell temporarily below the target range,the Open Market Desk would sell securities in the open market until the Treasury bill rate rose to the target range.
C) if the Treasury bill rate rose above the target range,the Open Market Desk would purchase Treasury bills or other government securities.
D) All of the above
Correct Answer:
Verified
Q42: The Taylor rule specifies
A)a constant relationship between
Q43: Throughout the 1980s,the Federal Reserve
A)primarily targeted M1.
B)primarily
Q44: Monetarists are in favor of
A)inflation targeting.
B)interest rate
Q45: If the Federal Reserve "pegs" the interest
Q46: If the Fed has the discretion to
Q48: Policy is conducted via a rule if
Q49: Assume that targeted inflation is 1 percent.According
Q50: If the central bank targets the money
Q51: Inflation targeting is one policy that attempts
Q52: Unlike a money supply target,an inflation rate
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