Exam 17: The Conduct of Monetary Policy: Strategy and Tactics

What are credit booms and why might a policy of leaning against a credit boom be preferred to leaning against asset-price bubbles?

The type of monetary policy that is used in Canada, New Zealand, and the United Kingdom is ________.

Which of the following is not an element of inflation targeting?

International policy coordination refers to ________.

New Zealand adopted inflation targeting in ________.

Using Taylor's rule, when the equilibrium real overnight rate is 3 percent, the positive output gap is 2 percent, the target inflation rate is 1 percent, and the actual inflation rate is 2 percent, the nominal overnight rate target should be ________.

Tight monetary policy in New Zealand ________.

During the 1975-1981 period, although the Bank of Canada was successful in keeping actual M1 growth within the target range, ________.

What does the Bank of Japan use as its daily operating target to conduct monetary policy?

The Bank of Canada formally abandoned monetary targeting ________.

Which of the following is a disadvantage to monetary targeting?

During the 1960s and early 1970s, the Bank of Canada used ________ as the intermediate target in the conduct of monetary policy.

Explain the Taylor rule, including the formula for setting the overnight rate target, and the components of the formula. If the Bank of Canada were to use this rule, how many goals would it use to set monetary policy?

In the 1975-1981 period, the Bank of Canada used ________ as the intermediate target of monetary policy.

What are the advantages of monetary targeting?

Hierarchical mandates ________.

In the 1975-1981 period, the Bank of Canada used ________ as the operating target and ________ as the intermediate target of monetary policy.

When it comes to choosing an policy instrument, both the ________ rate and ________ aggregates are measured accurately and are available daily with almost no delay.