PCM

 ECON 2301 MACROECONOMICS   

Chapter 14

Below you will find the learning objective, concept, idea, term, or theory that each question on the exam will cover. The numbers in the list refer to the question number on Exam 4 that will test your knowledge of that specific learning objective. Each of these topics/learning objectives is discussed in the textbook in the order that they are listed below.  A much better understanding can often be attained by working through the "active graphs" and "smart graphs" connected to many of these objectives in the online material.

 
    After reading Chapter 14, you should be able to:
  1. Distinguish between an expansionary and contractionary monetary policy.
  2. Discuss the three motives for holding money.
  3. Know the structure of the money market.
  4. Describe the money market adjustment to the equilibrium interest rate.
  5. Explain the equation of exchange.
  6. Discuss the role of the quantity theory in the conduct of monetary policy.
  7. Discuss the monetarist school of thought and its implications for monetary policy.
  8. Discuss the various complications of monetary policy.
  9. Interpret the relationship between monetary policy and interest rates.
  10. Address the importance of central banks staying independent of political pressures.