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2.2 Give an example of a monetary policy target. Explain why the Fed uses policy targets. 2.3 Use the money demand and money supply model to show graphically and explain the effect on interest rates of the Federal Reserve's open market purchase of Treasury securities. 2.4 Use the money demand and money supply model to show graphically and briefly explain the effect on the interest rate if real GDP increases.

2.2 Give an example of a monetary policy target. Explain why the Fed uses policy targets. 2.3 Use the money demand and money supply model to show graphically and explain the effect on interest rates of the Federal Reserve's open market purchase of Treasury securities. 2.4 Use the money demand and money supply model to show graphically and briefly explain the effect on the interest rate if real GDP increases.

Brief Principles of Macroeconomics (MindTap Course List)
Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter11: The Monetary System
Section: Chapter Questions
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2.2 Give an example of a monetary policy target. Explain why the Fed uses policy targets. 2.3 Use the money demand and money supply model to show graphically and explain the effect on interest rates of the Federal Reserve's open market purchase of Treasury securities. 2.4 Use the money demand and money supply model to show graphically and briefly explain the effect on the interest rate if real GDP increases.
Transcribed Image Text:2.2 Give an example of a monetary policy target. Explain why the Fed uses policy targets. 2.3 Use the money demand and money supply model to show graphically and explain the effect on interest rates of the Federal Reserve's open market purchase of Treasury securities. 2.4 Use the money demand and money supply model to show graphically and briefly explain the effect on the interest rate if real GDP increases.
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