Macroeconomics 1st Edition by Dean Karlan,Jonathan Morduch

Exercise 12

For each of the following situations, identify whether the Federal Reserve is likely to pursue an expansionary or a contractionary monetary policy.
a. The unemployment rate is at 0.5 percent.
b. The economy is experiencing record growth in GDP.
c. The unemployment rate is at 15 percent.
d. Inflation has reached 10 percent, a recent high.
e. A hurricane recently demolished a major city, causing a major recession.