Question

The Federal Reserve has a dual mandate (or responsibility) that requires it to focus first and foremost on which two things?

Answer 1

The Federal Reserve's dual mandate requires it to focus on maximum employment and stable prices. It adjusts monetary policy, including interest rates, to balance these goals and promote a healthy economy.

Step-by-step explanation:

The Federal Reserve has a dual mandate, which is a key aspect of its role in the U.S. economy. The two primary objectives that the Federal Reserve must focus on according to this mandate are maximum employment and stable prices. Maximum employment means that as many people as possible are employed, minimizing unemployment within the economy. On the other hand, stable prices mean controlling inflation by managing the levels of price increases over time to avoid significant fluctuations that could impact economic stability.

The Federal Reserve uses various tools to achieve these goals, including adjusting the federal funds rate, which influences interest rates throughout the economy. By fine-tuning monetary policy, the Federal Reserve aims to balance these objectives and promote a healthy economic environment that benefits everyone in the country.

Answer 2

Answer: The correct answer is : stable prices and also maximum employment

Explanacion: The objective of stable prices means keeping the inflation rate low and unpredictable. The goal of maximum employment means attaining the maximum sustainable growth rate of potential GDP, keeping real GDP close to potential GDP, and keeping the unemployment rate close to the natural unemployment rate.