Federal Reserve, Monterey & Fiscal Policy

"The Fed" refers to the....

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

The Federal Reserve System was established in

• 1799
• 1913
• 1863
• 1881

The Federal Reserve

• is made up of 12 district banks and 25 branch banks.
• is managed by a 12-member board of directors.
• is made up of district banks that operate independently from one another.

Fee charged to borrow money

• Inflation
• Interest
• Discount rate
• Reserve requirement

Which part of the Fed decides when to raise or lower interest rates?

• Board of Governors
• Advisory Committee
• Chairman
• Federal Open Market Committee

Influencing the economy by changing the reserve requirement is called:

• Fiscal policy
• Monetary policy
• Tight Money
• Easy Money

Does increasing the money supply cause inflation or deflation?

• Inflation
• Deflation

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.

In a recession, the Fed would likely

• Increase the supply of money in the economy
• Decrease the supply of the money in the economy

The Federal Reserve can increase __________, which makes banks more selective when loaning out money

• Reserve Requirements
• Percentage/Earnings Ratios
• Dividends
• Blue Chip Stocks