Whereas the Federal Reserve used to set a single target for the FFR, it now sets a range that is 25 basis points wide. sets a range that is 1 percentage point wide. sets multiple targets. does not set a target.
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- Explain which of the three policies do you think would be mosteffective due to COVID-19? expansionary monetary policy contractionary monetary policy public policyThe Chairman or Chairlady or Fed Chair (a politically correct term) of the Federal Reserve Bank has the power to override the votes of the FOMC and can independently carry out the monetary policy that they want as an individual. The FOMC is merely an advisory board to the Fed Chair. The FOMC has no real power, it's the Fed Chair (currently Jerome Powell) who has 100 percent of the power over U.S. monetary policy.The U.S. Department of Justice is solely responsible for enforcing the FCPA. True or False?
- Applied Problems on Monetary Policy and Interest Rates 1. For each of the following questions, draw the Money Demand curve (MD) and Money Supply curve (MS) and label the equilibrium interest rate as i*. Also show how the MS- MD graph changes due to the given events and as a result how the equilibrium interest rate changes. (In your answer you should clearly state and show what happens to the MS and MD curves and also what happens to the interest rate).Currently, Social Security is funded by current taxes. It is projected that in 2024, current taxes will not cover all Social Security beneficiaries. At that time Social Security will have to be funded by Question 37 options: the Federal Reserve the U.S. Treasury Congressional payments the Social Security Trust FundApplied Problems on Monetary Policy and Interest Rates 1. For each of the following questions, draw the Money Demand curve (MD) and Money Supply curve (MS) and label the equilibrium interest rate as i*. Also show how the MS- MD graph changes due to the given events and as a result how the equilibrium interest rate changes. (In your answer you should clearly state and show what happens to the MS and MD curves and also what happens to the interest rate).
- An expansionary monetary policy. Multiple Choice ___ is used when the inflation rate is high. ___ is designed to reduce aggregate demand. ___ can reduce the length of a resecession. ___ shifts the aggregate supply curve to the right.A large state's senator recently made a speech condemning the continuous deficits in the federal budget. She now proposes an increase in tax rates to raise more revenue for the government and thus gradually reduce the size of the national debt over a period of several years. This proposal is a common type of monetary policy. True or False True FalseCurrently, Social Security is funded by current taxes. It is projected that in 2024, current taxes will not cover all Social Security beneficiaries. At that time Social Security will have to be funded by Question 51 options: the Federal Reserve the Social Security Trust Fund Congressional payments the U.S. Treasury
- Multiple Choice. Select the most suitable answer. The speculative demand for money suggests that: (a) Individuals hold onto money for the purpose of engaging in transactions (b) As the rate of interest rate increases, the demand for money will rise (c) When the economy becomes more uncertain, people are more likely to hold unto money (d) The velocity of money is constant (e) As the rate of interest falls, the demand for money will rise.MULTIPLE CHOICE! ONLY answer! NO explanation! 1. If the inflation rate tends to go up, then which of the following is the appropriate monetary policy that the Fed should conduct?Open market sale which will increase interest rates and decrease money supplyOpen market purchase which will increase interest rates and decrease money supplyOpen market purchase which will decrease interest rates and increase money supplyOpen market sale which sale which will decrease interest rates and increase money supply 2. If the Fed conducts Open Market Purchase, then:price of bonds increase, interest rates decrease and money supply decreases.price of bonds decrease, interest rates increase and money supply decreases.price of bonds increase, interest rates decrease and money supply increases.price of bonds decrease, interest rates decrease and money supply increases. 3. Which of the following is called the Federal Funds rate?The interest rate at which banks borrow money from the Fed.the interest rate at…Which of the following is NOT a requirement in selecting a policy instrument? Question 4 options: a) controllability b) measurability c) flexibility d) predictability
