If Inflation and Unemployment Are of Direct Concern to Fed

question 109

Essay

If inflation and unemployment are of direct concern to Fed officials,why do they make such a big issue about money growth and interest rates? Why don't they just target the unemployment rate and the inflation rate directly? Explain.

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Definitions:

Psychological Approach

A method or strategy in psychology that focuses on understanding mental processes, behaviors, and emotional responses of individuals.

Behavior And Consciousness

Refers to the study of how actions (behavior) are influenced by or related to one's awareness and thought processes (consciousness).

Stream Of Consciousness

A narrative mode that attempts to capture the flow of thoughts and feelings running through the mind.

Functionalists

A perspective in sociology and psychology that emphasizes the importance of understanding the purpose or function of behavior and social institutions.