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Economics · Studypool

Economical Questions

Overview

1) How the Federal Reserve is controlling inflation by influencing interest rates? 

2) Are they heading in the right direction as it relates to interest rates and its effects on inflation?

3) Did they wait too long before taking any action, hence, a sense of urgency to crush the economy?

4) Should the economy maintain its current status, and the unemployment number remain in the 3.5% to 3.9% range, would the fed increase the next rate increase to say 100 basis points?

5) Or vice versa, if the economy shows signs of faltering and suddenly unemployment jumps to say 4.5% to 5.0%, would you expect the Fed to pivot, taking the opposite course as it relates to interest rates?

6) What effects would points 4 & 5 have on inflation respectively?