Which of the Following Explains Why the Monetary Policy Implementation

question 166

Multiple Choice

Which of the following explains why the monetary policy implementation lag is relatively short?
I. The FOMC meets several times a year and policymakers are easily able to confer in between meetings.
II. Open market operations, one of the Fed's policy instruments can be put into effect
Immediately.
III. The Chairman of the Fed works in close collaboration with the President.
IV. Most financial institutions are member banks and will not hesitate to put into effect any new monetary policy.

• A) I
• B) I and II
• C) I, II, and III
• D) I, II, III, and IV

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