When the Fed selects a variable that is midway between its current policy and its eventual goal, that variable is called
A)an intermediate target.
B)an operating target.
C)a policy target.
D)a recognition target.

Question

Quizplus · Accepted Answer

An intermediate target is the variable that the Federal Reserve uses to adjust its policy to reach its ultimate goal. It is set to be intermediate between the current policy and the eventual goal. For example, the Federal Reserve might use the unemployment rate as an intermediate target for its ultimate goal of achieving price stability.

When the Fed Selects a Variable That Is Midway Between