Suppose that the overnight interest rate falls to zero and output is below potential output.A central bank could:
A) Shift to targeting longer-term rates
B) Use its balance sheet to expand the monetary base
C) Purchase securities of different maturities to affect their market prices and rates
D) All of the answers given are correct
Correct Answer:
Verified
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A)Is always a problem
B)Is not a problem
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Q72: One reason most central bankers do not
Q73: The movement away from bank lending towards
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Q76: If the target federal funds rate reaches
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