Exam 16: The Conduct of Monetary Policy: Strategy and Tactics

The guiding principle for the conduct of monetary policy that held that as long as loans were being made for "productive" purposes,then providing reserves to the banking system to make these loans would not be inflationary became known as the

The rate of inflation tends to remain constant when

Which of the following is NOT an argument against using monetary policy to prick asset-price bubbles?

Which set of goals can,at times,conflict in the short run?

Unemployment resulting from a mismatch of workers' skills and job requirements is called

The theory that monetary policy conducted on a discretionary,day-by-day basis leads to poor long-run outcomes is referred to as the

The type of monetary policy regime that the Federal Reserve has been following in recent years can best be described as

Supply-side economic policies seek to

According to the Taylor rule,the Fed should raise the federal funds interest rate when inflation ________ the Fed's inflation target or when real GDP ________ the Fed's output target.

The problems of raising the level of the inflation target include

Although the Fed professed employment of ________ targeting during the 1970s,its behavior suggests that it emphasized ________ targeting.

The Fed's use of the federal funds rate as an operating target in the 1970s resulted in

Everything else held constant,a credit-drive bubble is generally considered to have the potential to cause ________ damage to an economy compared to an irrational exuberance bubble.

Due to the lack of timely data for the price level and economic growth,the Fed's strategy

In practice,the Fed's policy of targeting money market conditions in the 1960s proved to be

Lessons that economists and policy makers have learned from the recent global financial crisis include

In the 1970s,the Fed selected an interest rate as an operating target rather than a reserve aggregate primarily because it

Economists believe that countries recently suffering hyperinflation have experienced

In its earliest years,the Federal Reserve's guiding principle for the conduct of monetary policy was known as the

The ________ problem of discretionary policy arises because economic behavior is influenced by what firms and people expect the monetary authorities to do in the future.