2 Written Questions

1. the interest rate banks charge each other for overnight loans
2. conducting monetary policy so as to commit the central bank to achieving a publicly announced level of inflation

2 Multiple Choice Questions

1. the actions the Federal Reserve takes to manage the money supply and interest rates to pursue macroeconomic policy goals
   1. inflation targeting
   2. Taylor Rule
   3. monetary policy
   4. expansionary monetary policy
2. the federal reserve's adjusting the money supply to increase interest rates to reduce inflation
   1. expansionary monetary policy
   2. contractionary monetary policy
   3. inflation targeting
   4. monetary policy

2 True/False Questions

1. Taylor Rule → a rule developed by John Taylor that links the fed's target for the federal funds rate to economic variables

   True        False

2. expansionary monetary policy → the federal reserve's adjusting the money supply to increase interest rates to reduce inflation

   True        False