Consider these two quotes concerning recent Federal Reserve policy On December 12, 2012 the Federal Reserve issued the following statement:

"In particular, the Committee decided to keep the target range for the federal funds rate at 0 to \(1 / 4\) percent and currently anticipates that this exceptionally low range for the federal funds rate will be appropriate at least as long as the unemployment rate remains above 6. 5 percent."

On July 10, 2013, Ben Bernanke, Chairman of the Federal Reserve said:

"There will not be an automatic increase in interest rate when unemployment hits \(6.5 \%\)."

a. Why do both quotes focus on what policy will be in the future, rather than just explain what the Fed is doing in the present?

b. Why do you think the Fed Chair made the second statement?

c. On January 25, 2012, while the nominal policy interest rate was at the zero lower bound, the Federal Reserve announced an inflation target of \(2 \%\). What was the goal of this announcement?