In early March 2020, when the Fed cut the target for the federalfunds rate by...
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Economics
In early March 2020, when the Fed cut the target for the federalfunds rate by 0.5 percentage point, an article on bloomberg.comstated that the Fed took the move to "protect the longest-evereconomic expansion from the spreading coronavirus." Source: SophieCaronello and Craig Torres, "Fed Cuts Interest Rates by Half Pointin Emergency Move," bloomberg.com, March 3, 2020. Was the Fedsuccessful in keeping the U.S. economy out of a recession? A. Yesit was; the Fed's action in March 2020 were in time to keep the USout of recession. B. Yes it was; expansionary monetary policy suchas cutting the federal funds rate keeps an e?onomy out ofrecession. C. No it was not; the US was already in recession in2019 even before the Covid-19 pandemic began. D. No it was not; theFed's action in March 2020 were too late to keep the US out ofrecession.
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