tb18 - Chapter 18 Conduct of Monetary Policy Goals and...

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Chapter 18 Conduct of Monetary Policy: Goals and Targets T Multiple Choice 1) The objectives of the Federal Reserve in its conduct of monetary policy include (a) economic growth. (b) price stability. (c) high employment. (d) all of the above. Answer: D Question Status: Previous Edition 2) The goals of monetary policy include 3) The goals of monetary policy include
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624 Frederic S. Mishkin • Economics of Money, Banking, and Financial Markets, Seventh Edition 4) Even if the Fed could completely control the money supply, monetary policy would have critics because 5) High unemployment is undesirable because it (a) results in a loss of output. (b) always increases inflation. (c) always increases interest rates. (d) reduces the federal budget deficit. (e) reduces idle resources. Answer: A Question Status: New 6) When workers voluntarily leave work while they look for better jobs, the resulting unemployment is called 7) Unemployment resulting from a mismatch of workers’ skills and job requirements is called 8) The goal for high employment should seek a level of unemployment at which the demand for labor equals the supply of labor. Economists call this level of unemployment the
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Chapter 18 Conduct of Monetary Policy: Goals and Targets 625
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