MacroEconomics Unit2A

The Federal Reserve Bank ("The Fed") is a system of 12 regional banks which helps determine monetary policy and banking regulation.

• True

• False

The Fed can ___________ interest rates to help stop inflation

• even out

• raise

• decrease

• both increase and decrease

Raising or lower the ____________ _____________, or how much cash a bank has to keep on hand, is a tool of monetary policy.

• open market operation

• discount rate

• reserve requirement

• dunkin' donuts

Which is the largest component of government receipts (income)?

• corporate taxes

• excise taxes

• personal income taxes

• fuel taxes

Important state and local spending items include:

• highways; public schools

• public safety; traffic cones

• crosswalks; public libraries

• donut shoppes and grass mowing

This refers to the purchase of goods and services by individuals or households.

• Investment

• Export

• Import

• Consumption

In order to help the economy grow, the federal or state government can

• increase spending

• decrease spending

• lower taxes

• raise taxes

The action by the FED to adjust the size of the money supply, and to adjust interest rates in order to keep prices down and employment high refers to

• fiscal policy

• monetary policy

Which of these is NOT a characteristic of an unemployed person?

• He/she does not work

• He/she has made specific efforts to find a job

• He/she is laid off from a job in the succeeding months

• He/she is undergoing a career change

Who is in charge of Monetary Policy?

• Federal Government

• Federal Reserve

• The States

• The Department of the Treasury