The Fed followed a precommitment policy when it promised to keep short-term interest rates low for a period of time after the 2008/09 U.S. recession.
Answer the following statement true (T) or false (F)
True
A precommitment policy is a policy to pursue a particular action for a period of time. This precommitment policy was designed to assure investors that short-term rates would not rise, and this assuaged fears that there would be losses on low-interest rate bonds.
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Government's ability to reduce private-sector economic risks through laws and regulations would encourage all of the following, except:
A. Higher levels of private economic investment B. Formation of new businesses C. Introduction of new products and processes D. Reduction of private goods and services
If the dollar depreciates, it can be said that
A. foreign countries no longer respect the United States. B. it falls in value within the United States. C. it takes fewer dollars to buy foreign currencies. D. other currencies appreciate.