Unit 5 & 6 Macroeconomics

What is monetary policy?

• Feds control supply / availability / cost of money

• People control supply / availability / cost of money

• Congress control supply / availability / cost of money

• None of the above

What are examples of monetary policy?

• Actions to restrict / relinquish money

• Actions to limit money

• Actions to expand / control money

• Actions to extend the debt

What is fiscal policy?

• Congress borrowing from foreign intities

• Govt. borrowing, spending, and taxing

• Federal Chair expanding debt to expand governmental operations

• Fiscally managing money for governmental functions

What are examples of fiscal policy

• Healthcare, Groceries, Gas

• Home Improvements, Car repairs, Dental

• Restaurants, Vacations, Pet Care

• Welfare, Medicare, Social Security

What is the Reserve Requirement?

• Requirement to keep fraction of deposit

• Requirement to keep Congress funded

• Requirement to keep percentage of loans

• Requirement to keep the Reserve open

What is the Open Market?

• Fed is not in charge of stocks/bonds from the government

• Fed buys securities (stocks/ bonds) from govt.

• Fed is part of the government and has nothing to do with stocks/bonds.

• None of the above

What is a Margin Requirement?

• Amount of stock must deposit to by investments

• The amount of funds required to have a margin

• Margin Requirement is simple the margin of funds given during loans

• Amount an invent must deposit to buy stocks

What is the Discount Rate?

• Amount of loans the Fed gives out to the government

• Amount of interests Fed charges to members

• Amount of debt the government has versus the debt the government owns

• None of the above

When the Federal Reserve sells government securities on the Open Market, what happens to the nation’s money supply and interest rates?

• Money Supply Increases / Interest Rates Decrease

• Money Supply increases / interest rates increase

• Money Supply Decreases / Interest Rates Increase

• Money Supply decreases / interest rates decrease

What is the name of the “central bank” of the United States?

• Central Bank Reserve

• Congressional Reserve

• Market Reserve

• Federal Reserve