Podcast
Questions and Answers
What is the primary objective of the Federal Reserve in regulating the money supply?
What is the primary objective of the Federal Reserve in regulating the money supply?
- To maintain a stable economy (correct)
- To promote trade policies
- To stimulate spending
- To control the labor market
What is the effect of an increase in the money supply on interest rates?
What is the effect of an increase in the money supply on interest rates?
- It has no effect on interest rates
- It fluctuates interest rates
- It raises interest rates
- It lowers interest rates (correct)
What is the term used by the Federal Reserve to refer to the money supply in its public releases?
What is the term used by the Federal Reserve to refer to the money supply in its public releases?
- Money stock (correct)
- Monetary aggregate
- Money supply index
- Money flow
What is the consequence of too much money flowing in the economy?
What is the consequence of too much money flowing in the economy?
What is the outcome of increased business activity in response to an increase in the money supply?
What is the outcome of increased business activity in response to an increase in the money supply?
What is the tool used by the Federal Reserve to control interest rates?
What is the tool used by the Federal Reserve to control interest rates?
What is the term for the amount of cash that the public at large is keeping on hand rather than depositing in banks?
What is the term for the amount of cash that the public at large is keeping on hand rather than depositing in banks?
What is the goal of an expansionary monetary policy?
What is the goal of an expansionary monetary policy?
When the Federal Reserve limits the money supply, what happens to interest rates?
When the Federal Reserve limits the money supply, what happens to interest rates?
What is the risk of limiting the money supply too much?
What is the risk of limiting the money supply too much?
Which institution is responsible for regulating the money supply in the United States?
Which institution is responsible for regulating the money supply in the United States?
What is the purpose of open market operations in monetary policy?
What is the purpose of open market operations in monetary policy?
What is the primary goal of inflation targeting in monetary policy?
What is the primary goal of inflation targeting in monetary policy?
According to the Taylor Rule, when should a central bank raise interest rates?
According to the Taylor Rule, when should a central bank raise interest rates?
What is the inflation rate targeted by the U.S. Federal Reserve?
What is the inflation rate targeted by the U.S. Federal Reserve?
What is one of the advantages of inflation targeting?
What is one of the advantages of inflation targeting?
What is one of the dual mandate objectives of the Federal Reserve?
What is one of the dual mandate objectives of the Federal Reserve?
What is a limitation of inflation targeting, according to critics?
What is a limitation of inflation targeting, according to critics?
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