KEY TERMS

activist, p. 600

bank reserves, p. 575

bank run, p. 577

Board of Governors of the Federal

Reserve System, p. 578

central bank, p. 574

credibility, p. 603

depository institutions, p.

discount rate, p. 581

discount window lending, p. 581 discretion, p. 600

Federal Open Market Committee

(FOMC), p. 579

federal funds rate, p. 580

fed funds rate, p. 580

forward guidance, p. 584

fractional reserve banking, p. 575

high-powered money, p. 575

instruments, p. 590

intermediate targets, p. 590

liquidity trap, p. 584

monetarism, p. 601

monetary base, p. 575

multiple expansion of loans and deposits, p. 576

100% reserve banking, p. 575 open-market purchase, p. 577 open-market sale, p. 577 quantitative easing, p. 585 reserve-deposit ratio, p. 575 rules, p. 600

Taylor rule, p. 604

zero lower bound, p. 583

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