The monetary policy target the Federal Reserve focuses primarily on today is
A)the unemployment rate.
B)M1.
C)the inflation rate.
D)the interest rate.
E)M2.

Question

Quizplus · Accepted Answer

The Federal Reserve's primary monetary policy target is to control the federal funds rate, which is the interest rate at which banks lend and borrow reserves from each other overnight. By setting a target for the federal funds rate, the Fed can influence other interest rates in the economy, which can impact inflation, employment, and economic growth. Therefore, the correct answer is D, the interest rate.

The Monetary Policy Target the Federal Reserve Focuses Primarily on Today