"As Greenspan Chases Inflation, Critics Shout, 'Faster!

question 151

Multiple Choice

"As Greenspan Chases Inflation, Critics Shout, 'Faster!'
"For weeks, the Fed has broadcast its intention to raise interest rates glacially." The Fed was moving slowly, according to an economist because "... the declining price of oil, economic fundamentals, incl productivity and global competition, will keep inflation in check." The Fed, recognizing that the eco was improving stated it planned to "respond to changes in economic prospects as needed to fulfill i obligation to maintain price stability." Other economists disagree with the Fed's restrained policy "mistake."
Www) nytimes, 7/1/20
As a result of the Fed's policy, the Fed will securities on the open market and .

• A) sell; increase reserves
• B) sell; decrease reserves
• C) buy; decrease reserves
• D) buy; increase reserves

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Definitions:

Output Price

The cost at which goods or services are offered for sale in the marketplace.

Graduate School

An advanced academic institution providing postgraduate education in various disciplines, leading to degrees like Master's or Doctorate.

Factor Of Production

An essential input to the production process, such as labor, capital, land, and entrepreneurship.

Marginal Productivities

The additional output that is produced by using one more unit of a particular input, ceteris paribus.