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

Large fluctuations in money supply growth and smaller fluctuations in the federal funds rate between October 1982 and the early 1990s indicate that the Fed had shifted to ________ as an operating target.

When workers voluntarily leave work while they look for better jobs,the resulting unemployment is called

A credit-driven bubble arises when ________ in lending causes ________ in asset prices which can cause ________ in lending.

A borrowed reserves target is ________ because increases in income ________ interest rates and discount loans,causing the Fed to ________ the monetary base,everything else held constant.

The problems of raising the level of the inflation target include

The rate of inflation tends to remain constant when

According to the Taylor rule,the Fed should raise the federal funds interest rate when inflation ________ the Fed's inflation target or when real GDP ________ the Fed's output target.

In practice,the Fed's policy of targeting money market conditions in the 1960s proved to be

When asset prices increase above their fundamental values it is called an

Which of the following is not a requirement in selecting a policy instrument?

Suppose interest rates are kept very low for a long time such that there is a spike in the amount of lending. Everything else held constant,this could cause ________ bubble.

The Fed's use of the ________ as an operating target in the 1970s resulted in ________ monetary policy.

High unemployment is undesirable because it

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

International policy coordination refers to

The monetary policy strategy that provides the least accountability is

The real bills doctrine was the guiding principle for the conduct of monetary policy during 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 ________.

________ bubble is driven entirely by unrealistic optimistic expectations.

The first country to adopt inflation targeting was