When the Federal Reserve can't cut short-term nominal rates any further and its capacity to cut long-term rates is limited, might be the only effective tool left to stabilize the economy. discretionary fiscal policy mandatory spending an automatic stabilizer monetary policy

When the Federal Reserve can't cut short-term nominal rates any further and its capacity to cut long-term rates is limited, might be the only effective tool left to stabilize the economy. discretionary fiscal policy mandatory spending an automatic stabilizer monetary policy

Economics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506725

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter12: Fiscal Policy, Incentives, And Secondary Effects

Section: Chapter Questions

Problem 2CQ

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When the Federal Reserve can't cut short-term nominal rates any further and its capacity to cut long-term
rates is limited, might be the only effective tool left to stabilize the economy.
discretionary fiscal policy
mandatory spending
an automatic stabilizer
monetary policy

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