Exploring the Impact of Monetary Policy on Global Economies

What was money originally backed by in modern currencies?

• Silver

• Gold

• Oil

• Diamonds

What type of money system do we use today, where currency's value is declared by the government?

• Fiat money

• Cryptocurrency

• Commodity money

• Barter system

Why must businesses within a country accept its currency?

• Economic stability

• Historical tradition

• Government declaration

• International agreement

What happens when a country manipulates its currency to be cheaper?

• It stabilizes the economy

• It boosts domestic industries

• It encourages imports

• It increases inflation

What is a potential negative effect of increasing the money supply too much?

• Currency appreciation

• Inflation

• Deflation

• Economic stagnation

What can cause an economic crisis according to the video?

• Low interest rates

• Too much inflation

• Excessive government regulation

• Too much deflation

What is deflation?

• Increase in money supply

• Decrease in employment rates

• Decrease in general price levels

• Increase in currency value

How does the Fed influence the economy?

• By regulating education

• By setting tax rates

• Through healthcare reforms

• Through monetary policy

What is the primary goal of the Federal Reserve's dual mandate?

• To maintain the gold reserve

• To ensure political stability

• To maximize employment and keep inflation low

• To regulate international trade

Why is the U.S. dollar considered unique in the global economy?

• It has the highest value

• It is the oldest currency

• It is backed by gold

• It is the most widely used in international trade