What are five essential characteristics or features that a well-managed central bank should possess?After explaining each one, rate the FED on how well or how poorly it embodies each feature with a brief explanation. P.S. use my five essential characterists and rate FED by using them!!!!!!!!!!!! 1) A central bank should be goal dependent 2) A central bank should be instrument independent 3) A central bank should stress transparecy and communication 4) A central bank should have the goal of financial stability. 5) A central bank should be accounable

What are five essential characteristics or features that a well-managed central bank should possess?After explaining each one, rate the FED on how well or how poorly it embodies each feature with a brief explanation. P.S. use my five essential characterists and rate FED by using them!!!!!!!!!!!! 1) A central bank should be goal dependent 2) A central bank should be instrument independent 3) A central bank should stress transparecy and communication 4) A central bank should have the goal of financial stability. 5) A central bank should be accounable

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter14: Macroeconomic Policy: Tradeoffs, Expectations, Credibility, And Sources Of Business Cycles

Section: Chapter Questions

Problem 8E

See similar textbooks

Similar questions

Assume an economy is experiencing a recession What are the three major tools a central bank can use to address the recession? b. What would the central bank do with each tool to increase the money supply? Explain for each. a.
Suppose that the Bank of Canada determines that the Canadian economy is currently overproducing. What can the Central Bank do to slow down economic activity? a. The Central bank can pursue an expansionary monetary policy by increasing the money supply, causing a decrease in the interest rate. As a result, real GDP will increase and the price level will increase. b. The Central bank can pursue a contractionary monetary policy by decreasing the money supply, causing a decrease in the interest rate. As a result, real GDP will decrease and the price level will decrease c. The Central bank can pursue a contractionary monetary policy by decreasing the money supply, causing an increase in the interest rate. As a result, real GDP will decrease and the price level will decrease. d. The Central bank can pursue a contractionary monetary policy by decreasing the money supply, causing an increase in the interest rate. As a result, real GDP will decrease and the price level will increase e. The…
When the Fed implements policy to prevent problems before they happen, it is called policy. O macropecuniary O macroconservative O macroengineered macroprudential
Is full employment a realistic goal for a central bank? Please illustrate using examples
Consider the following scenario: a. In Argentina, the central bank needs to determine by how much to increase the money supply next year. Suppose they estimate an increase in the overall economic activity (real GDP) of 2.5% percent and have a target inflation rate of 4%. The velocity of money has been observed to be constant over the past many years. By what level should the central bank change the money supply to achieve its inflation target? b. Next year, the central bank of Argentina wishes to reduce inflation to 2 percent, and estimates an increase in real GDP by 1.5 percent. What should be the change in the money supply? c. What is an "inflation tax", and how might it explain the creation of inflation by a central bank?
Hi, can I get help with this question I'm not sure what to choose? I'm confused base on the graph and I'm not quite sure what statement is accurate. The graph is in the attachments with download data. Here's the question: Why is it important for the central bank to be independent from the part of the government responsible for spending? A. The Federal Reserve is, historically, driven by political ideologies. Allowing it to influence the rest of government could harm its ability to enact effective monetary policy. B. If not independent, the government might be tempted to have the central bank print more money (creating inflation) whenever the government runs a budget deficit. C. If not independent, the government might be tempted to have the central bank print more money (creating deflation) whenever the government runs a budget surplus.
If the Fed opts to employ open market operations to increase the money supply, then a.The Fed will have to compensate for this change by increasing the discount rate b.Bond rates will increase because the Fed must buy Treasury bonds from individuals in the market, and this will cause the demand for these bonds to increase c.Banks will petition the Fed to increase the federal funds rate to recoup their losses d.Government budget surpluses will be more likely to achieve e.Bank reserves will decrease as consumers withdraw funds to purchase more Treasury Bonds and this will have an effect on the money supply via the money multiplier
1a. What is the proper objective function for monetary policy? b. How transparent should the central bank be? c. Should a central bank adopt formal inflation targeting? d. Should monetary policy be made by an individual or a committee? e. Should central banks also be bank supervisors?
(c) Monetory policy authorities will respond to the change in price level that occurred in part (b). How might the central bank respond to the change you described in part (b)? (d) Draw a correctly labeled graph of the money market. a. Label the equilibrium interest rate. b. Show on your graph the change in money supply that will occur due to the monetary policy described in part (c). c. Show on your graph the change in interest rates that will occur due to the monetary policy described in part (c). (e) At the same time, assume that policymakers at the Bank of England enforce an expansionary monetary policy.
What are the two components of the Fed's dual mandate? A. Output stability and financial market stability B. Price stability and interest rate stability C. Interest rate stability and foreign exchange stability D. Price stability and output stability
a. List the three main tools of monetary policy used by the Fed and briefly describe how each of the tools impacts the money supply and interest rates. b. Give examples of both restrictive and easy monetary policy.
Imagine that the economy is experiencing inflation and that the Reserve Bank of Australia (RBA) decides to implement a contractionary monetary policy or 'tight money' to return inflation to its target level. 1.What type of open market operations (OMOs) will the RBA undertake consistent with a contractionary monetary policy approach? 2. How will the money supply be affected? 3.Explain how the three stages of transmission process from a contractionary monetary policy link a change in interest rates with a change in an economy’s equilbrium level of output. 4.Using the IS-LM curve diagram, illustrate the impact of a contractionary monetary policy. Make sure to clearly indicate the new equilibrium position including the interest rate and output