The Fed Prefers to Change Its Interest Rate Target Only

question 54

Multiple Choice

The Fed prefers to change its interest rate target only rarely because

• A) those targets affect productivity in the labor force
• B) a fluctuating stock and bond market signals a recession
• C) interest rates are greatly overrated as a measure of economic performance
• D) it is so difficult to do so
• E) the changes destabilize the financial markets

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Definitions:

Null Hypothesis

A default hypothesis that indicates no effect or no difference, and is tested against an alternative hypothesis.

Triglyceride Levels

Triglyceride Levels indicate the amount of triglycerides present in the blood, a type of fat that, in high levels, can increase the risk of heart disease.

Standard Deviation

A method for estimating the scatter or disparity among a set of numerical values.

Wilcoxon Signed Rank Test

A non-parametric statistical test used to compare two related samples or repeated measurements on a single sample to assess differences.