Asked by Maxine Wiebenga on Jul 03, 2024
Verified
The Fed seeks a target rate of inflation of around _____.
A) 1 percent
B) 2 percent
C) 3 percent
D) 4 percent
E) 5 percent
Target Rate
A target interest rate set by the central bank in a country that guides monetary policy decisions, aiming to control inflation, encourage borrowing, or stabilize the economy.
Inflation
A measure of the rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is falling.
- Grasp the significance of certain inflation targets set by the Federal Reserve.
Verified Answer
ZK
Zybrea KnightJul 06, 2024
Final Answer :
B
Explanation :
The Federal Reserve seeks a target rate of inflation of around 2 percent. This is because a low and stable rate of inflation is seen as beneficial for long-term economic growth and stability.
Learning Objectives
- Grasp the significance of certain inflation targets set by the Federal Reserve.