Federal Reserve

What can the Federal Reserve do to slow down the rate of inflation?

• Raise Interest rates.

• Lower interest rates.

• Raise Taxes

• Lower Taxes

Which reason best explains why the Federal Reserve will lower interest rates?

• To increase the inflation rate

• To increase government spending

• To encourage people to spend their money in order to stimulate the economy.

• To encourage people to save their money in order to stabilize the economy.

All are roles of the Federal Reserve except?

• Regulate the interest rates on home mortages

• Control the interest rate that banks borrow money at

• Control the amount of money in circulation

• Regulate how much money banks must keep on hand

The Federal Reserve System is-----

• The federal government's bank

• Responsible for legislative purchases

• the federal government's tax collector

• Accountable for legislative actions

Which of the following actions might the Federal Reserve take if the economy was experiencing higher than desired inflation?

• Raise the federal funds rate

• Raise the discount rate

• Sell government securities on the open market

• Decrease the reserve requirement

What is the central bank of the United States called?

• National Savings and Loan

• National Credit Union

• Federal Reserve

• Federal Bank

A goal of the Federal Reserve System is to-

• Provide tax money to the government

• Set the tax rate

• Keep the economy stable

• Maintain high interest rates

What can the Federal Reserve do to help stimulate the economy and bring it out of a recession?

• Lower interest rates

• Raise interest rates

• Raise taxes

• Lower taxes

Banks will most likely try to discourage banks and consumer form borrowing money-

• When interest rates are too low

• When a person does not have any money

• When the interest rates are too high

• They do not discourage banks and consumers to borrow money