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Part 1 -check Your Understanding - Use the graph below of the federal funds rate to answer the following questions _ The vertical gray bars
Part 1 -check Your Understanding - Use the graph below of the federal funds rate to answer the following questions _ The vertical gray bars on the graph represent recessions m ad ...... Ellutm Federal Funds at. {3 17.5 153 11.5 is 7.5 1960 1970 1900 I9\" 2000 NH! 1. According to the graph ,what happens to the 3. Identify a range of years when the Federal federal funds rate when there is a recession ? Reserve most likely used expansionary monetary policy .Explain your reasoning 2. Identify a range of years when the Federal 4. How does a lower federal funds rate impact Reserve most likely sold the most government output ,unemployment ,and price level in the bonds _Exp|ain your reasoning _ short an? 5. After analyzing the graph above ,your friend assumes that a decrease in the federal funds rate causes a recession .Explain why that assumption is incorrect 5. The Federal Reserve does not directly set the federal funds rate.How does the Federal Open Market Committee (FOMC )ensure that the federal funds rate falls within their target range '2
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