Most Decisions About Implementing Monetary Policy Are Made By

question 23

Multiple Choice

Most decisions about implementing monetary policy are made by:

• A)the chairman of the Fed only.
• B)the president.
• C)the president and Congress.
• D)the Federal Open Market Committee.

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Definitions:

Money Supply

The total amount of monetary assets available in an economy at a specific time, including currency and various types of deposits.

Fisher Effect

The economic theory proposing that the real interest rate is independent of monetary measures, especially the nominal interest rate and the expected inflation rate.

Real Interest Rate

The rate of interest an investor expects to receive after allowing for inflation, showing the real gain of an investment.

After-tax Real Rate

The actual income rate of return on an investment, after accounting for inflation and taxes.