The Fed's Use of the Federal Funds Rate as an Operating

question 55

Multiple Choice

The Fed's use of the federal funds rate as an operating target in the 1970s resulted in

• A)countercyclical monetary policy.
• B)too slow growth in M1 throughout the decade.
• C)procyclical monetary policy.
• D)too rapid growth in M1 throughout the decade.

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Definitions:

Standard Deviation

Standard deviation is a measure that quantifies the amount of variation or dispersion of a set of data values, used to understand how spread out the values are from the mean.

Mean Speed

The average velocity of an object over a defined period of time.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values; a low standard deviation means that the values tend to be close to the mean, while a high standard deviation means they are spread out over a wider range.

Normal Model

Also known as the normal distribution, a bell-shaped curve that represents the distribution of many types of data where most values cluster around a mean value.