Economics Topic 6 Lesson 2 & 3 Quiz

"The Fed" refers to the....

• Federal Bureau of Investigation
• Federal Government
• Federal Reserve System
• Federal Income Tax

What happens to the money circulation, when the FED orders a tight money policy?

• more money is put out into circulation
• less money is put into circulation
• circulation stays the same
• interest rates rise

If the Federal Reserve wanted to stimulate the economy (make it grow), they might

• Sell Treasury bonds
• Buy Treasury bonds
• Spend more money
• Spend less money

Which of the following scenarios would cause the nation’s money supply to increase?

• Decreasing government spending
• Lowering interest rates
• Raising interest rates
• Selling bonds to investors

There are _______ Regional Federal Reserve Banks, and one Federal Reserve Board of Governors.

• 50
• 4
• 12
• 52

what is the purpose of Monetary Policy?

• contribute to economic growth and stability

• keep rich people from getting too rich

• Functions like Fiscal Policy

• give Congress and the political parties more control of the economy

The primary role of the Federal Reserve Bank is to steer the economy by

• controlling the budget
• setting spending levels.
• controlling the money supply.
• loaning out money.

Which of the following would the FED us to increase the money supply?

• raise the discount rate
• raise the required reserves
• buy bonds/securities
• print more money

____________ is the price paid for the use of money.

• Gold

• Monetary policy

• Fiscal policy

• The interest rate

In institution that accepts deposits and makes loans is defined as 

• A bank
• Insurance
• Gambling
• A loan shark