Federal Reserve Quiz

According to the WebQuest, in what capacity does the Federal Reserve act as a "bankers' bank"?

• Providing loans to individuals

• Offering emergency financial services

• Managing savings accounts

• The document does not specify

What role does the federal government play alongside the Federal Reserve according to the document?

• It also helps ensure economic stability

• It competes with the Federal Reserve

• It focuses solely on healthcare

• No role is specified in the document

What is the primary method the Federal Reserve uses to control inflation according to monetary policy?

• Adjusting government spending

• Modifying tax rates

• Implementing interest rate changes

• Regulating stock market

Identify two economic problems that are caused by inflation.

• Increased unemployment and lower savings

• Decreased investment and higher interest rates

• Reduced purchasing power and increased cost of living

• Higher export rates and lower import charges

What is the usual trade-off when the Federal Reserve makes policy to lower inflation?

• Increase in unemployment

• Decrease in national debt

• Increase in export rates

• Decrease in consumer spending

What are the three main goals of the Federal Reserve's mission?

• Ensure national security, control inflation, and reduce unemployment

• Promote maximum employment, stable prices, and moderate long-term interest rates

• Increase economic growth, stabilize the currency, and promote trade balances

• Reduce poverty, control inflation, and promote technological advancements

What are the primary purposes of the Federal Reserve?

• Fiscal Policy (Taxes & Spending)

• Monetary Policy (Money Supply

What is the Federal Reserve aka FED's main concern?

• Unemployment

• Inflation

• GDP

• Happiness

The Fed ______________ banks to ensure the soundness of the banking system.

• regulates
• closes
• opens
• runs

The Federal Reserve

• is made up of 12 district banks.

• is managed by a 10-member board of directors.

• is made up of district banks that operate independently from one another.