The Fed's Use of the ________ as an Operating Target

question 105

Multiple Choice

The Fed's use of the ________ as an operating target in the 1970s resulted in ________ monetary policy.

• A)federal funds rate;countercyclical
• B)federal funds rate;procyclical
• C)M1 money supply;countercyclical
• D)M1 money supply;procyclical

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Definitions:

Lump Sum Payment

A single payment made for the entirety of an owed amount, instead of breaking it into multiple payments.

Economic Difference

The disparity in economic conditions, wealth, or resources between different groups or regions.

Compounded Monthly

The process where interest earned is added to the principal sum each month, which then earns further interest.

Inheritance

Assets or property received from someone who has passed away, often as dictated by a will or the laws of intestacy.