Under a rules strategy for monetary policy, the Fed would
A)follow specific and publicly announced guidelines for policy.
B)adjust monetary policy as it sees fit.
C)target the growth rate of M1, but not the growth rate of M2.
D)target the growth rate of M2, but not the growth rate of M1.

Question

Quizplus · Accepted Answer

Under a rules strategy for monetary policy, the Fed would follow specific and publicly announced guidelines for policy. This would create transparency and predictability in the market, which could help to stabilize the economy.

Under a Rules Strategy for Monetary Policy, the Fed Would