ECON 2101 Chapter 15
(27 questions and
answers)
Which one of the following is not one of the monetary policy goals of the
Fed? - answer Reduce income inequality.
Why is the Fed sometimes said to have a "dual mandate"?
The Fed is said to have a" dual mandate" because - answer Maintaining price
stability and high employment are the two most important goals of the Fed
that are explicitly mentioned in the Employment Act of 1946.
Which of the following is a monetary policy target used by the Fed? - answer
Interest rate.
The Fed uses policy targets of interest rate and/or money supply because -
answer It can affect the interest rate and the money supply directly and
these in turn can affect unemployment, GDP growth, and the price level.
What do economists mean by the demand for money? - answer It is the
amount money-currency and checking account deposits-that individuals
hold.
What is the advantage of holding money? - answer Money can be used to
buy goods, services, or financial assets.
What is the disadvantage of holding money? - answer Money, in the form of
currency or checking account deposits, earns either no interest or a very low
rate of interest.
(27 questions and
answers)
Which one of the following is not one of the monetary policy goals of the
Fed? - answer Reduce income inequality.
Why is the Fed sometimes said to have a "dual mandate"?
The Fed is said to have a" dual mandate" because - answer Maintaining price
stability and high employment are the two most important goals of the Fed
that are explicitly mentioned in the Employment Act of 1946.
Which of the following is a monetary policy target used by the Fed? - answer
Interest rate.
The Fed uses policy targets of interest rate and/or money supply because -
answer It can affect the interest rate and the money supply directly and
these in turn can affect unemployment, GDP growth, and the price level.
What do economists mean by the demand for money? - answer It is the
amount money-currency and checking account deposits-that individuals
hold.
What is the advantage of holding money? - answer Money can be used to
buy goods, services, or financial assets.
What is the disadvantage of holding money? - answer Money, in the form of
currency or checking account deposits, earns either no interest or a very low
rate of interest.
