
Monetary Policy: Reserve Requirement & Interest on Reserves
Authored by Michelle Ashley
Social Studies
12th Grade - University
Used 63+ times

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17 questions
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1.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
If the Federal Reserve raises interest rates to combat rapid inflation, what might be a negative outcome?
2.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
The Federal Reserve wants to reduce the nation's money supply. This could be accomplished by doing all of the following EXCEPT
decreasing the discount rate.
increasing the reserve requirement.
selling securities on the open market.
increasing interest on reserves
3.
MULTIPLE SELECT QUESTION
5 mins • 1 pt
If the Federal reserveis attempting to encourage growth and stimulate the economy, which actions would each take?
increase the Required reserve
decrease the required reserve
increase interest on reserves
decreases interest on reserves
4.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
Which of the following will lead to a decrease in the nation's money supply?
an increase in reserve requirements
decrease in reserve requirements
5.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
If a country's economy is operating below the full employment level of output at a very low inflation rate, the central bank of the country is most likely to
lower the discount rate and buy bonds on the open market to generate an increase in output
lower the required reserve ratio and sell bonds on the open market to generate an increase in output
raise the discount rate and lower the required reserve ratio to generate an increase in output
6.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
To counteract a recession, the Federal Reserve should
raise the reserve requirement and increase interest on reserves
lower the reserve requirement and decrease interest on reserves
7.
MULTIPLE SELECT QUESTION
5 mins • 1 pt
Choose all that apply
In order to increase the money supply and speed up GDP, the Federal reserve must do which of the following?
Lower interest on reserves
Buy bonds
Lower the reserve requirement ratio
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