Targeting Interest Rates and Targeting the Money Supply Are Equivalent

question 13

Multiple Choice

Targeting interest rates and targeting the money supply are equivalent if

• A) money demand is stable
• B) banks hold no excess reserves
• C) exchange rates are fixed
• D) central banks practice inflation targeting
• E) consumers exhibit rational expectations

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Definitions:

Population Assumptions

Premises or conditions considered to be true about a population from which a sample is drawn for statistical analysis.

Wilcoxon Rank Sum Test

A statistical test that doesn't rely on parameter-based data, designed to evaluate if there's a difference in the population mean ranks between two unrelated samples.

5% Significance Level

A threshold in hypothesis testing that indicates a 5% probability of rejecting the null hypothesis when it is actually true, a standard benchmark in statistical analysis to determine significance.

Location Of Population

Describes the geographic or spatial distribution of members or elements of a given population.