Which of the following constitute the Federal Reserve's dual mandate? Question 14 options: Maximize consumer surplus and reach full employment. Reach full employment and stabilize prices. Maximize consumer surplus and stabilize prices. Reach full employment and optimize long-run growth. Reach full employment and maximize bank profits. Maximize consumer surplus and optimize long-run growth.

Which of the following constitute the Federal Reserve's dual mandate? Question 14 options: Maximize consumer surplus and reach full employment. Reach full employment and stabilize prices. Maximize consumer surplus and stabilize prices. Reach full employment and optimize long-run growth. Reach full employment and maximize bank profits. Maximize consumer surplus and optimize long-run growth.

MACROECONOMICS FOR TODAY

10th Edition

ISBN:9781337613057

Author:Tucker

Publisher:Tucker

Chapter16: Monetary Policy

Section16.A: Policy Disputes Using The Self Correcting Aggregate Demand And Supply Model

Problem 4SQ

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The Federal Reserve was created after: a period of very high unemployment. a series of bank runs and bankruptcies. an extended period of economic stagnation. an increase in the inflation rate.
During an economic downturn, a nation's central bank decides to implement quantitative easing by purchasing large amounts of government securities to increase the money supply and encourage lending and investment. This policy action is intended to: A) Tighten the money supply B) Increase interest rates C) Stimulate economic growth D) Reduce public spending
The major problem facing the economy is high unemployment and weak economic growth. The inflation rate is low and stable. Therefore, the Federal Reserve decides to pursue a policy to increase the rate of economic growth. Which policy changes by the Fed would tend to offset each other in trying to achieve that objective? selling government securities and raising the discount rate selling government securities and raising the reserve ratio .buying government securities and raising the discount rate buying government securities and lowering the reserve ratio
An increase in the money supply occurs when Question 16 options: the price level falls. the interest rate increases. the Fed makes open-market purchases. money demand increases.
Which of the following statements are true based on these graphs? Check all that apply. The unemployment rate is currently 6% higher than the natural rate of unemployment. The natural level of output is $9 trillion. The current quantity of output is greater than potential output. Suppose the central bank of the economy increases the money supply. Show the long-run effects of this policy on both of the graphs by shifting the appropriate curves. The long-run effect of the central bank's policy is in real GDP. in the inflation rate, in the unemployment rate, and
PRICE LEVEL Show the long-run effect of this change according to the monetarist view, ceteris paribus, by dragging one or both curves on the graph below. (?) REAL GDP AD SRAS AD SRAS
The money demand curve is Select one from the following options. downward-sloping because the opportunity cost of holding money is inversely related to the interest rate. downward-sloping because the opportunity cost of holding money rises as the interest rate falls. upward-sloping because the opportunity cost of holding money rises with the interest rate. downward-sloping because the opportunity cost of holding money rises as the interest rate rises.
As a "lender of last resort" the Fed :protects the deposits of $100,000 or less in all commercial banks in the country .bails out any depository institution it has decided should not be allowed to fail .bails out any corporation the government has decided should not fail .is obligated to bail out any depository institution in the country that is in financial difficulty
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Which of the following is an example of a contractionary policy? A) Raising reserve ratio B) Raising taxes C) Raising discount rate D) All of the above
If the Fed was concerned about the economy falling into recession, it might accommodate this development by stimulating the economy through: raising the interest rate paid on reserves. purchasing additional government securities. conduct open market sales. raise the interest rates that consumers and businesses pay when taking out loans.
The 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.