In Response to Already Low Interest Rates Doing Little to Stimulate

question 77

Multiple Choice

In response to already low interest rates doing little to stimulate the economy, the U.S.Federal Reserve began buying 10-year Treasury notes and certain mortgage-backed securities to keep interest rates low.This policy is known as

• A)inflation targeting.
• B)contractionary monetary policy.
• C)securities-bubble deflating.
• D)quantitative easing.
• E)discretionary monetary policy.

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Definitions:

Profit-Maximizing

An approach or strategy aimed at achieving the highest possible profit from business operations.

Worker Cost

The total expense incurred by an employer in compensating an employee, including wages, benefits, and taxes.

Purely Competitive Market

An idealized market form where products are identical, allowing for easy entry and exit of firms, leading to perfect information and no control over prices by any single entity.