ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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What specific actions could the Federal Reserve take to decrease the money supply and therefore raise interest rates to enact Contractionary
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- Which of the following is considered to be a relatively drastic tool of monetary policy? altering the reserve requirements quantitative easing altering the discount rate reducing the money supplyarrow_forwardHow does the Federal reserve Bank "influence" interest rates to meet the objectives of the Fed?arrow_forwardWhich tool of the monetary policy is most frequently used by the Fed to change the money supply?arrow_forward
- When economy has recovered from deep recession from zero-lower-bound, there is no risk of using contractionary monetary policy.” – True or false? Explain.arrow_forwarddescribe the actions the Federal Reserve took to maintain a healthy economy during the recent economic crisis. in your opinion, were the actions necessary? were the Fed’s actions effective?arrow_forwardThe Central banks' tools to control the money supply include the discount rate, and interest payments on reserves. How should each instrument be changed if the Central bank wishes to decrease the money supply?arrow_forward
- Has monetary policy exerted a stabilizing impact on the U.S. Economy during the past decade?arrow_forwardFaced with the possibility of recession explain how monetary policy may be used to rectify the position and how effective is such a policy likely to be.arrow_forwardWhy does having a dual mandate complicate policy making at a central bank like the FED? Why do some people say that the FED also has a third mandate? If the FED can only directly control nominal interest rates, how does the FED influence real interest rates that determine the actual stance of monetary policy? What circumstances or issues created the need for modern monetary policy?arrow_forward
- What do Federal Reserve economists use the Federal Reserve Board's model of the U.S. economy for? It is used only for forecasting. It is used for forecasting and policy analysis. It is used only to describe the economy. It is used only for policy analysis.arrow_forwardCarefully explain how the Federal Reserve (Fed) will use each of the three monetary policy tools at its disposal to decrease the money supply.arrow_forwardIf you were to survey central bankers from around the world and ask them what they believe the primary task of monetary policy should be, what would the most popular answer likely be?arrow_forward
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