If a central bank wishes to reduce inflation, it should announce its intentions
ID: 1110981 • Letter: I
Question
If a central bank wishes to reduce inflation, it should announce its intentions and follow through with them, thereby using _________ monetary policy.
Select one:
A. integral
B. authoritative
C. credible
D. visible
Following the terrorist attacks of September 11, 2001, the Federal Reserve increased:
Select one:
A. its lending to banks.
B. open market sales of bonds.
C. the discount rate.
D. required reserve ratios.
Which of the following would be an example of running monetary policy by rules?
Select one:
A. The Fed will increase money growth to different levels, depending on the severity of the recession.
B. An increase in money supply automatically leads to an increase in inflation.
C. A 1% drop in real GDP will automatically elicit a 2% increase in money supply.
D. A 5% increase in money supply automatically leads to a 2% increase in real GDP.
The disinflation experiment reduced inflation in the United States but at the cost of:
Select one:
A. deflation.
B. an increase in the long-run growth rate of the economy.
C. high inflation.
D. high unemployment.
A significant real shock in an economy can result in:
I. a leftward shift of the Solow growth curve.
II. a leftward shift of the short-run aggregate supply curve.
III. consumer pessimism and a leftward shift of the aggregate demand curve.
Select one:
A. I and II only
B. I and III only
C. II and III only
D. I, II, and III
Economists who believe that the Federal Reserve is likely to make lots of mistakes in the implementation of monetary policy believe:
Select one:
A. that the Federal Reserve should be abolished.
B. in monetary policy discretion.
C. in monetary policy run by the federal government.
D. in monetary policy rules.
Explanation / Answer
Answer:- If a central bank wishes to reduce inflation, it should announce its intentions and follow through with them, thereby using _________ monetary policy.
Correct option:- C. credible
Answer:- Following the terrorist attacks of September 11, 2001, the Federal Reserve increased:
Correct option:- A. its lending to banks.
Answer:- Which of the following would be an example of running monetary policy by rules?
Correct Answer:- C. A 1% drop in real GDP will automatically elicit a 2% increase in money sup
Answer:- The disinflation experiment reduced inflation in the United States but at the cost of:
Correct Option:- B. an increase in the long-run growth rate of the economy.
Answer:- A significant real shock in an economy can result in:
Correct Answer:- D. I, II, and III
Answer:- Economists who believe that the Federal Reserve is likely to make lots of mistakes in the implementation of monetary policy believe:
Correct Option:- D. in monetary policy rules.
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.