Quantitative Easing Is

question 75

Multiple Choice

Quantitative easing is:

• A) statements today about policy targets in the future.
• B) expansion of the supply of aggregate reserves beyond the amount needed to maintain the policy rate target.
• C) asset purchases that shift the composition of the Fed's balance sheet.
• D) expansion of the demand for aggregate reserves to drive down the IOER.

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Definitions:

Nominal NNP

The Gross National Product measured at current market prices, without adjusting for inflation.

Real NNP

Net National Product adjusted for inflation; measures the value of goods and services produced by a country's economy, less the value of goods and services used up in production, adjusted for price changes.

Price Index

A statistical measurement that tracks changes in the price level of a basket of goods and services over time.

Inventories

The raw materials, work-in-process products, and finished goods that are considered to be the portion of a business's assets that are ready or will be ready for sale.