Question
In early March 2020, when the Fed cut the terget for the federal funds rate by 0 5 percentage point, an article on bloomberg com
In early March 2020, when the Fed cut the terget for the federal funds rate by 0 5 percentage point, an article on bloomberg com stated that the Fed took the move to "protect the longest-ever economic expansion from the spreading coronavirus.
Source: Sophie Caronello and Craig Torres, "Fed Cuts Interest Rates by Half Point in Emergency Move," bloomberg.com, March 3, 2020.
1. Was the Fed successful in keeping the US economy out of a recession?
A. No it was not the US was already in recession in 2019 even before the Covid-19 pandemic began
B. Yes it was, the Fed's action in March 2020 were in time to keep the US out of recession
C. No it was not, the Fed's action in March 2020 were too late to keep the US out of recession
D. Yes it was, expansionary menetary policy such as cutting the federal funds rate keeps an economy out of recession
2.What was a difficulty the Fed faced in keeping the economic expansion that begin in June 2009 going
A. The US was already in recession in 2019 even before the Cond-19 pandemic began, even though the data had not yet showm this
B. The Fed was limited to cutting the federal funds rate by at most 0 5 percentage points, so it could not do enough to avoid the Covid-related recession
C. The Fed did not understand that an economic recession could anse from a health-related pandemic
D. No monetary policy action could have prevented the recession given the mandatary closure of most businesses worldwide
Explanation and conclusion please
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started