Question

1.

Traditional monetary policy is conducted by managing :

Group of answer choices

the prime rate.

mortgage rates.

the federal funds rate.

the discount rate.

2.

What is required to achieve the Federal Reserve's broad goal of achieving a safer, more flexible financial system?

Group of answer choices

Safe and sound financial institutions

A strong infrastructure for payments

Both A and B

Congressional oversight of the banking system.

3.

A unified national currency was established and a heavy tax was placed on state bank notes by the:

Group of answer choices

Federal Reserve Act of 1913.

Emergency Banking Act of 1933.

National Banking Acts of 1863-1865.

Silver Purchase Act of 1890.

4.

Which of the Federal Reserve's monetary policy tools is associated with its role as lender of last resort but is used primarily as a signal of the Fed's policy intentions?

Group of answer choices

Open market operations

The discount rate

Reserve requirements

Interest on reserves

5.

If the inflation rate were falling and the unemployment rate were high and rising, the FOMC would likely respond by doing which of the following?

Group of answer choices

Increasing the federal funds target rate and selling government securities

Increasing the federal funds target rate and buying government securities

Decreasing the federal funds target rate and selling government securities

Decreasing the federal funds target rate and buying government securities

6.

Longer term interest rates:

Group of answer choices

are not important for investment decisions.

affect the economy and employment through their effect on investment.

have no effect on inflation.

all of the above.

7.

The charter of the First Bank was not renewed in 1811 due to political turmoil. What led to the founding of the Second Bank of the United States in 1816?

Group of answer choices

Continuous bank panics

The need for a larger economy

Large amounts of counterfeit currency in circulation

The government's financial problems after the War of 1812

8.

During the mid-1800s about one-third of the currency in circulation in the United States was:

Group of answer choices

counterfeit.

missing.

redesigned.

large in size.

9.

During the financial crisis of 2008, many of the Fed's actions were what type of policies?

Group of answer choices

Liquidity policies

Monetary policies

Credit policies

Fiscal policies

Answer 1

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