Review Monetary Policy

This is a paper component of the money supply, today consisting of Federal Reserve notes.

• coins
• currency
• both coins and currency
• debit cards

Monetary policy resulting in lower interest rates and greater access to credit; associated with an expansion of the money supply.

• tight money policy
• open market policy
• easy money policy
• excess reserve policy

Monetary policy resulting in higher interest rates and restricted access to credit; associated with a contraction of the money supply.

• easy money policy
• tight money policy
• open market policy
• interest rate policy

Selling bonds

• increases money supply
• decreases money supply

Which of these is NOT a monetary policy tool?

• Discount rate
• Balance Accounts
• Open Market Operation
• Reserved Requirements

Buying bonds

• increases money supply
• decreases money supply

High reserve requirements 

• lower the money supply
• increase the money supply

Low reserve requirements 

• lower the money supply
• increase the money supply

"The Fed" refers to the....

• Federal Bureau of Investigation
• Federal Government
• Federal Reserve System
• Federal Income Tax

What happens to the money circulation, when the FED orders a tight money policy?

• more money is put out into circulation
• less money is put into circulation
• circulation stays the same
• interest rates rise