Critics of the Fed's Use of Financial Variables as Targets

question 41

Multiple Choice

Critics of the Fed's use of financial variables as targets have proposed that the Fed

• A)use indicator variables such as nominal GDP, the yield curve, and the exchange rate.
• B)abandon open market operations and use only discount loans and changes in the required reserve ratio as tools.
• C)should concentrate solely on its role as lender of last resort.
• D)be made subordinate to the Treasury.

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Definitions:

Constantinople

Historical city, now Istanbul, Turkey, significant for its strategic location and rich history as the capital of the Byzantine Empire and later the Ottoman Empire.

Architectural Setting

The specific built environment or context within which a building, scene, or narrative takes place, contributing to its aesthetic and functional qualities.

Italy

A European country known for its rich history, art, architecture, fashion, and cuisine, stretching from the Alps to the Mediterranean Sea.

French Gothic

An architectural style that originated in France in the 12th century, characterized by its use of pointed arches, ribbed vaults, and flying buttresses.