Exam 18:Monetary Policy: Stabilizing the Domestic Economy

 The conventional policy tools available to the Fed include each of the following, except the: ?

 Until 2008, the Fed could make the market federal funds rate equal the target rate by: ?

 What is the difference between primary and secondary credit offered by the Fed and who would use secondary credit? 

 If reserve demand is volatile, in order for the central bank to keep interest rates from being volatile, it must: 

 For most of the Fed's history, the Fed: ?

 During the 1990s many countries developed a monetary policy framework that focused on inflation targeting. This is an example of policymakers: ?

 We saw in Chapter 18 that many central banks have turned to a policy framework of inflation targeting. Discuss if this would be effective in a country experiencing deflation. 

 The interest rate the Fed charges for secondary credit is: ?

 Which of the following features would characterize a good monetary policy instrument? ?

 Why is it necessary to distinguish between the target federal funds rate range and the market federal funds rate? 

 Which of the following statements is most correct? ?

 Given the following formula for the Taylor rule: ?Target federal funds rate = natural rate of interest + current inflation + ½(inflation gap) +½(output gap)?If the inflation rate in the economy were to fall by 2% below the target inflation rate, the target federal funds rate would: ?

In the period of 1979 to 1982, if the Fed had set an interest rate target that was equal to the actual market interest rates that occurred, the: ?

 What is the consensus among economists and other monetary policy experts regarding the usefulness of the monetary policy instruments available to central banks in normal times? 

 If the market federal funds rate were below the target rate, the response from the Fed would likely be to: ?

 The conventional tools of monetary policy include: ?

 If the market federal funds rate were above the target rate, the response from the Fed would likely be to: ?

 The ECB now frequently uses _____ to inject reserves into the banking systems of countries that use the Euro. ?

Unconventional monetary policy tools include all but:

 When the Fed wants to tighten monetary policy, the staff of the Fed is likely to: ?