Exam 16: The Conduct of Monetary Policy: Strategy and Tactics

The Fed accidentally discovered open market operations when

Which of the following is a potential operating instrument for the central bank?

The strengthening of the dollar between 1980 and 1985 contributed to a ________ in American competitiveness,putting pressure on the Fed to pursue a more ________ monetary policy.

During World War II,the Fed in effect relinquished its control of monetary policy through its policy of

Under Alan Greenspan and Ben Bernanke,the Federal Reserve was successful in pursuing a ________ policy.

The decision by inflation targeters to choose inflation targets ________ zero reflects the concern of monetary policymakers that particularly ________ inflation can have substantial negative effects on real economic activity.

Economists believe that countries recently suffering hyperinflation have experienced

The fluctuations in both money supply growth and the federal funds rate during 1979-1982 suggest that the Fed

The Fed-Treasury Accord of March 1951 provided the Fed greater freedom to

Unemployment resulting from a mismatch of workers' skills and job requirements is called

The rate of inflation tends to remain constant when

Using Taylor's rule,when the equilibrium real federal funds rate is 2 percent,there is no output gap,the actual inflation rate is zero,and the target inflation rate is 2 percent,the nominal federal funds rate should be

Inflation results in

A central feature of monetary policy strategies in all countries is the use of a nominal variable that monetary policymakers use as an intermediate target to achieve an ultimate goal such as price stability. Such a variable is called a nominal

If the central bank pursues a monetary policy that is more expansionary than what firms and people expect,then the central bank must be trying to

In both New Zealand and Canada,what has happened to the unemployment rate since the countries adopted inflation targeting?

Since the early 1990s,the Fed has conducted monetary policy by setting a target for the

If the Taylor Principle is not followed and nominal interest rates are increased by less than the increase in the inflation rate,then real interest rates will ________ and monetary policy will be too ________.

Estimates from large macroeconometric models of the U.S. economy suggests that it takes over ________ for monetary policy to affect output and over ________ for monetary policy to affect the inflation rate.

During the 1950s,Fed monetary policy targeted