The defensive and offensive actions of the Fed differ because offensive actions are designed to:
A)tighten monetary policy and defensive actions are designed to ease monetary policy.
B)ease monetary policy and defensive actions are designed to tighten monetary policy.
C)change the current monetary policy while defensive actions are designed to reinforce the current monetary policy.
D)reinforce the current monetary policy while defensive actions are designed to change the current monetary policy.

Question

Quizplus · Accepted Answer

Offensive actions by the Federal Reserve (Fed) are intended to change the current monetary policy direction, such as moving from a stance of easing to tightening or vice versa, depending on economic conditions and policy objectives. Defensive actions, on the other hand, are aimed at maintaining the current policy stance, ensuring that short-term fluctuations or operational factors do not deviate the economy from the intended policy path.

The Defensive and Offensive Actions of the Fed Differ Because