When considering the velocity of money, the Federal Reserve is most concerned about its
A) stability.
B) absolute size.
C) determinants.
D) sign.

Question

Quizplus · Accepted Answer

The Federal Reserve is most concerned about the stability of the velocity of money. This is because rapid fluctuations in the velocity of money can negatively impact the economy and make it difficult for the Fed to control inflation and maintain economic stability. Therefore, the Fed closely monitors changes in the velocity of money and takes actions to stabilize it when necessary.

When Considering the Velocity of Money, the Federal Reserve Is