Which of the Following Statements Is Most Accurate About the Fed's

question 90

Multiple Choice

Which of the following statements is most accurate about the Fed's use of the federal funds rate target since the 2008 financial crisis?

• A) It stimulated quick recovery from the Great Recession, and the target is now at pre-crisis levels.
• B) The target has become significantly more important as a tool for signaling policy changes.
• C) The Fed effectively lost the ability to use the target for monetary policy since there is a lack of reserves today.
• D) The Fed effectively lost the ability to use the target for monetary policy since banks no longer have a problem meeting their reserve requirement.

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