The Main Argument Against Fed Independence Is That

question 54

Multiple Choice

The main argument against Fed independence is that

• A)in a democracy elected officials should make public policy.
• B)monetary and fiscal policy would be easier to coordinate if the Fed were not independent.
• C)the Fed has proven irresponsible on many occasions.
• D)congressional control was tried during the 1960s and it worked well.

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Definitions:

Non-Discounted Cash Flow

Cash flows that are not adjusted for the time value of money, representing raw incoming or outgoing cash streams.

Mutually Exclusive

Situations or events that cannot occur at the same time, implying a choice between alternatives.

IRR Rule

A decision-making tool used in finance to evaluate investments, stating that a project is acceptable if its internal rate of return exceeds the required rate of return.

NPV

A method used to evaluate the attractiveness of an investment project, assessing the value of all future cash flows against initial expenditure.