Inflation Targeting Is a Monetary Policy Rule That Requires the Central

question 89

Multiple Choice

Inflation targeting is a monetary policy rule that requires the central bank to adjust _____ in order to attain the desired inflation rate.

• A) a price index
• B) the velocity of money
• C) nominal GDP
• D) the money supply

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Definitions:

Mortgage Pass-Through

A type of security that pools mortgage loans and passes the principal and interest payments from borrowers to investors.

Mortgage Loans

Long-term loans used to purchase real estate property, secured by the property itself.

General Obligation Bonds

Bonds issued by municipalities that are backed by the full faith and credit of the issuing government, promising to repay the debt with general revenue.

Revenue Bond

A type of municipal bond supported by the revenue from a specific project, such as a toll bridge or highway.