in an operating target, such as the federal funds ratoe, ls designed to impact a
ID: 1118413 • Letter: I
Question
in an operating target, such as the federal funds ratoe, ls designed to impact a. A policy goal, such as real GDP b. A policy instrument, such as c. An intermediate target, such as real GDP d. An operating goal, such as savings inflation 89. Which of the following correctly depic a. Policy goals drive policy instrument use b. Policy instruments affect cts the relation among policies and targets? operating targets which impact intermediate targets to achievea goal c. Intermediate goals determine which targets impact the policy instrument d. All of the above 90. A policy instrument available to the Fed to reduce a negative output gap (unemployment) would be a. Exchange rates b. Tax rates c. Interest rates d. Open market operations he correct policy instrument action taken by the Fed to reduce a negative output gap would be a. Sell securities b. Buy securities c. Raise tax rates d. Lower the exchange rate 92. The intermediate target that the Fed's action is designed to impact to reduce the negative output gap is a. Real GDP b. Inflation C. Net exports d. Economic growth 93. The policy goal that the Fed is trying to achieve to reduce a negative output gap is a. Economic growth b. Full-employment c. Stable prices d. Increased exports 94. The economist who was very critical of fiscal policy, and beieved that the economy should be let alone and allowed to self-adjust, a. John Maynard Keynes b. Milton Friedman c. Charles Engles d. Karl Marx 95. The economist reference in the question above, was instrumental in promoting a. Fiscal policy b. Discretionary policy c. Monetary Policy and Monetarism d. CommunismExplanation / Answer
88. B) a policy instrument, such as inflation.
A raise in the federal funds rate causes the inflation to come down. Changes in federal interest rate effects the short term interest rates.
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