Macroeconomics 15th Edition by James Gwartney, Richard Stroup, Russell Sobel, David Macpherson

Exercise 9

Answer the following questions:
a. What is the most important thing the Fed can do to promote economic stability
b. Can expansionary monetary policy reduce interest rates and stimulate a higher growth rate of real output in the long run
c. If monetary policy is too expansionary, how will nominal interest rates and the general level of prices be affected