29) An inflation rate targeting ruleA) reduces uncertainty about monetary policy.means that the inflation rate must exceed 5 percent in order for the rule to be effective.nas been adopted the by the Fed in response to the financial crisis of 2008-2009.D) will not work if the Fed continues to sue open market operations.30) "As the Fed Chases Inflation, Critics Shout, 'Faster!""For weeks, the Fed has broadcast its intention to raise interest rates glacially." The Fed was moving slowly, according toan economist because "..the declining price of oil, economic fundamentals, including productivity and globalcompetition, will keep inflation in check." The Fed, recognizing that the economy was improving stated it planned to"respond to changes in economic prospects as needed to fulfill its obligation to maintain price stability." Other economistsdisagree with the Fed's restrained policy as a "mistake."www.nytimes, 7/1/2004Economists estimate that if the Fed's policy was enacted in July 2004, the impact on the economyA) can be expected to stretch over one to two years.B) will occur to its fullest extent within one month.C) will not be evident in the exchange rate market until 2005.D) will reach its fullest extent, affecting real GDP, in three to six months.

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29) An inflation rate targeting rule A) reduces uncertainty about monetary policy. D) means that the inflation rate must exceed 5 percent in order for the rule to be effective. ) Has been adopted the by the Fed in response to the financial crisis of 2008-2009. D) will not work if the Fed continues to sue open market operations.

29) An inflation rate targeting rule A) reduces uncertainty about monetary policy. D) means that the inflation rate must exceed 5 percent in order for the rule to be effective. ) Has been adopted the by the Fed in response to the financial crisis of 2008-2009. D) will not work if the Fed continues to sue open market operations.

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter17: The Short-run Trade-off Between Inflation And Unemployment

Section: Chapter Questions

Problem 6CQQ

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Question

29) An inflation rate targeting rule
A) reduces uncertainty about monetary policy.
means that the inflation rate must exceed 5 percent in order for the rule to be effective.
nas been adopted the by the Fed in response to the financial crisis of 2008-2009.
D) will not work if the Fed continues to sue open market operations.
30) "As the Fed Chases Inflation, Critics Shout, 'Faster!"
"For weeks, the Fed has broadcast its intention to raise interest rates glacially." The Fed was moving slowly, according to
an economist because "..the declining price of oil, economic fundamentals, including productivity and global
competition, will keep inflation in check." The Fed, recognizing that the economy was improving stated it planned to
"respond to changes in economic prospects as needed to fulfill its obligation to maintain price stability." Other economists
disagree with the Fed's restrained policy as a "mistake."
www.nytimes, 7/1/2004
Economists estimate that if the Fed's policy was enacted in July 2004, the impact on the economy
A) can be expected to stretch over one to two years.
B) will occur to its fullest extent within one month.
C) will not be evident in the exchange rate market until 2005.
D) will reach its fullest extent, affecting real GDP, in three to six months.

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