If the central bank targets the money supply,it will
A) provide increased liquidity when the demand for money rises
B) raise interest rates to encourage lending whenever banks hold excess reserves
C) conduct open market sales of securities whenever the demand for money falls
D) allow interest rates to rise when the demand for money rises
E) not act to offset credit tightening by banks
Correct Answer:
Verified
Q22: The next questions refer to the following.
Suppose
Q23: The credit channel refers to
A) changes in
Q24: If the central bank follows the Taylor
Q25: Quantitative Easing refers to
A) A dramatic increase
Q26: Which of the following is not a
Q28: Which of the following would reduce short
Q29: When the central bank undertakes an open
Q30: Higher short term interest rates can be
Q31: The monetary base consists of
A) gold and
Q32: Inflation targeting most commonly consists of
A) a
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