ECONOMICS
FEDERAL RESERVE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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increase stock market volatility
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reduce unemployment
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seek price stability
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keep unemployment low and prices stable
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Detailed explanation-1: -The Federal Reserve System has been given a dual mandate-pursuing the economic goals of maximum employment and price stability. It does this by using a variety of policy tools to manage financial conditions that encourage progress toward its dual mandate objectives-in other words, conducting monetary policy.
Detailed explanation-2: -Tools the Federal Reserve Uses To Control Inflation The Fed has several tools it traditionally uses to tame inflation. It usually uses open market operations (OMO), the federal funds rate, and the discount rate in tandem. It rarely changes the reserve requirement.
Detailed explanation-3: -Today, the Fed uses its tools to control the supply of money to help stabilize the economy. When the economy is slumping, the Fed increases the supply of money to spur growth. Conversely, when inflation is threatening, the Fed reduces the risk by shrinking the supply.
Detailed explanation-4: -A dual mandate is the practice in which elected officials serve in more than one elected or other public position simultaneously.