In the early stages of macroeconomic model building,the money supply is regarded as a policy ________ that is under ________ control by the Federal Reserve.
A)goal,perfect
B)goal,imperfect
C)instrument,perfect
D)instrument,imperfect

Question

Quizplus · Accepted Answer

In the early stages of macroeconomic model building, the money supply is regarded as a policy instrument, meaning it is a tool used by policymakers (in this case, the Federal Reserve) to achieve their economic objectives. It is considered to be under perfect control by the Federal Reserve, implying that the Fed can precisely adjust the money supply to influence economic conditions as desired.

In the Early Stages of Macroeconomic Model Building,the Money Supply