Critics of the Federal Reserve Maintain That, to Correct the Credibility

question 70

Multiple Choice

Critics of the Federal Reserve maintain that, to correct the credibility problem of monetary policy, the Fed should:

• A)tighten monetary policy.
• B)be required to maintain a growth rate of the money supply that is fixed by law.
• C)give more power to the Federal Open Market Committee.
• D)ignore public opinion and establish more discretionary power over monetary policy.
• E)merge with the U.S.Treasury and be dissolved as an independent agency.

---

Definitions:

Marginal Revenue

The extra revenue a company earns by selling an additional unit of a product or service.

Prices

The cash amount one needs to spend to obtain a good, service, or asset.

Marginal Cost

The uptick in cumulative expenses that comes from producing an additional unit of a product or service.

Total Revenue

The total receipts from sales of a given quantity of goods or services.