Monetary and Fiscal Policy

Fee charged by the Federal Reserve Bank for other member banks to borrow money from the FED through the discount window?

• inflation

• interest

• discount rate

• reserve requirement

The goal of monetary policy is to

• sell bonds

• reduce unemployment

• prevent inflationary and recessionary economic periods

• increase tariffs on foreign countries

The federal government is attempting to encourage spending by consumers and businesses, a fiscal policy BEST serving this purpose would be

• decreasing taxes

• decreasing government spending

• reducing the investment tax credit

• balancing the budget

Which of the following is a monetary policy action used to combat a recession?

• cutting taxes
• increasing the money supply
• decreasing the money supply
• raising taxes

If the Federal reserve and Government are attempting to encourage growth and stimulate the economy, which actions would each take? 
(monetary / fiscal)

• increase the Required reserve / increase government spending
• sell government securities / decrease taxes
• decrease the interest rate / increase government spending
• buy government securities / decrease government spending

If the federal government is attempting to encourage spending by consumers and businesses, a fiscal policy BEST serving this purpose would be

• decreasing taxes.
• decreasing government spending.
• reducing the investment tax credit.
• balancing the budget.

The rate the Fed charges banks for a loan

• Discount rate
• Federal fund rate
• reserve ratio
• prime rate

An example of expansionary is what? (Multiple answers - must pick all to receive credit)

• Decrease taxes

• Raise taxes

• Government spends more on Science research

• Government cuts organizations like the National Science Foundation

Examples of contractionary fiscal policy includes which of the following (choose all correct answers)?

• Raise taxes on corporations

• Lower the corporate tax rate

• Government increases spending on research in Antarctica

• Government cuts spending on education

What body of the Federal Reserve oversees the purchase and sale of government securities/bonds?

• Federal Open Market Committee.

• Advisory Council.

• Board of Governors

• Federal Reserve Bank of Dallas