In the 1970s,the Fed Selected an Interest Rate as an Operating

question 57

Multiple Choice

In the 1970s,the Fed selected an interest rate as an operating target rather than a reserve aggregate primarily because it

• A)had no interest in targeting a monetary aggregate,as evidenced by its unwillingness to target a reserve aggregate.
• B)was still very concerned with achieving interest rate stability.
• C)was committed to targeting free reserves.
• D)was committed to the real bills doctrine.

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Definitions:

Parallel Circuit

A type of electrical circuit in which the components are connected alongside each other, forming branches such that each component has the same voltage.

Resistor Voltage

The voltage drop across a resistor, determined by the current flowing through it and its resistance, according to Ohm's Law.

Power Factor

A measure of how effectively electrical power is converted into useful work output, with a value ranging from 0 to 1, where 1 indicates maximum efficiency.

Parallel Circuit

An electrical circuit in which components are connected in parallel, resulting in the same voltage across each component but possibly different currents through each.