Who created the Federal Reserve System? |
Congress |
When was the Federal Reserve Board created? |
1913 |
The Federal Reserve System is controlled by? |
The Board of Governors of the Federal Reserve |
Members of the Board of Governors of the Federal Reserve are appointed by the President for? |
14-year terms |
Where is the Board of Governors located? |
Washington, D.C. |
Which is NOT part of the Federal Reserve System? |
SEC |
How many districts make up the Federal Reserve System? |
12 |
In which Federal Reserve district do you live? |
5 |
What is the purpose of the Federal Open Market Committee (FOMC)? |
to determine the nation’s monetary policy in order to help encourage a healthy economy |
The number of times the FOMC typically meets is? |
8 |
The Federal Reserve System can best be described as? |
The central banking system for the United States |
Which of these best describes the function of the Federal Reserve? |
Responsible for monetary policy/money supply |
Which organization established the Federal Reserve System? |
congress |
The Federal Reserve System is controlled by? |
The Board of Governors of the Federal Reserve |
What does the Federal Reserve do? |
Raises or lowers interest rates |
Which of the following is NOT part of the Federal Reserve System? |
The Federal Deposit Insurance Corporation |
Which of these is NOT a function of the Federal Reserve? |
Manage the federal deficit |
The principal function of the Federal Open Market Committee is to? |
buy and sell U.S. government bonds to influence the money supply |
What tool does the Fed rely on the most in conducting policy? |
??? domes change the discount rate got that one wrong |
Monetary policy is implemented by? |
the Federal Reserve |
Which of the following is not a function of money? |
speculative investment |
Which of the following is NOT a tool of monetary policy? |
Increasing federal spending |
Today the MOST important function of the Federal Reserve System is? |
regulating the nation’s money supply |
Which of the following is NOT money? |
Credit cards |
The largest component of M1 is? |
cash |
If the Federal Reserve Bank wanted to increase the amount of bank lending it will? |
Lower the amount of money banks must hold as required reserves |
First National Bank has demand deposits of $500. The required reserve ratio is 10%. FNB can lend? |
450 |
The use of taxation or government spending to alter economic outcomes is? |
Fiscal policy |
To reduce inflation the federal government can? |
??????isn’t lower taxes |
Which of the following would NOT be an example of fiscal policy? |
A law making certain drugs illegal |
Which of the following best fit with fiscal policy? |
Taxes and government spending |
Who is responsible for U.S. fiscal policy? |
congress |
Which of the following does not involve government spending? |
buying a new car |
What is the primary purpose of taxation? |
to support the government |
Which of the following is an example of contractionary fiscal policy? |
Decreasing government spending |
What is the effect of expansionary fiscal policy on the money supply? |
increases it |
What is the effect of contractionary fiscal policy on the money supply? |
decreases it |
The most important measure of the country’s overall economic performance is? |
Gross Domestic Product (GDP) |
The purchasing power of people’s incomes is most affected by? |
The inflation rate |
Which is used measure inflation? |
The Consumer Price Index |
A business cycle refers to? |
the ups and downs of real GDP |
What is a common definition of a recession? |
Two consecutive quarters of declining GDP |
Unemployment that is directly related to swings in the business cycle is? |
cyclical unemployment |
The low point in the business cycle is referred to as the? |
through |
A period of recovery from a recession is called a/an? |
expansion |
The unemployment rate? |
does not count people who have stopped looking for jobs as unemployed |
Which of the following persons would be considered unemployed? |
A recent college graduate looking for first job |
Monetary policy is? |
The use of money and credit to influence the economy |
The 2002 Job Creation and Worker Assistance Act, passed by Congress would be an example of? |
fiscal policy |
Gross Domestic Product is a measure of? |
The dollar value of output produced domestically within a given time period |
The largest component of GDP is? |
consumer spending |
CPI is a measure of the overall cost of? |
goods and services bought by a typical consumer |
The goal of the consumer price index is to measure changes in the? |
cost of living |
What would happen to employment if the government mandated a minimum wage above what employers currently pay? |
employment would go down |
What must the government do to reduce high inflation? |
Decrease both spending and the money supply. |
Banks have reserve requirements so that? |
they have enough money on hand for customers |
The buying and selling of government bonds by the Federal Reserve which affects interest rates, bank reserves and the money supply are? |
Open Market Operations |
A period during which production or economic activity expands, then contracts for several quarters or more, and then expands again; usually measured by real gross domestic product (GDP) is a? |
Business Cycle |
When government spending is greater than government income in a given year the results is known as? |
Budget deficit |
Econ- Unit 7
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