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The US Federal Reserve Has Recently Been Engaged in Quantitative Easing

question 15

Essay

The U.S. Federal Reserve has recently been engaged in quantitative easing in which it is essentially expanding the money supply. What are the likely short-run and long-run implications of this?


Definitions:

Negative Reinforcement

The strengthening of a response (increases in frequency) because it is followed by the removal of a (presumably) unpleasant stimulus.

Control of Antecedents

The management or manipulation of factors that precede and potentially trigger certain behaviors or reactions, used as a strategy in behavior modification.

Decrease a Response

A reduction in the intensity, frequency, or effectiveness of a response to a stimuli or situation.

Antecedent

Something that exists or happens before something else and may influence or cause it.

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