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WorksheetsFederal Reserve Review
Total questions: 60
Worksheet time: 30mins
The current chairperson of the Federal Reserve is:
Jerome Powell
Alan Greenspan
Ben Bernanke
Janet Yellen
The Fed keeps a certain amount of money out of circulation. This is referred to as the...
Reserve requirement
Emergency Fund
Stockpile
Hoard
The tools and strategies used by the Fed to stabilize the economy are called...
Fiscal policy
Monetary policy
Tight Money
Easy Money
A rise in the cost of goods and services is called...
inflation
discount rate
interest
deflation
The Federal Reserve...
Regulates the amount of money.
Supervises Banks.
Provides Financial Services.
All of the above.
Which 1913 act of Congress finally reestablished the National Bank?
Federal Reserve Act
Gibbons Ogden Act
Temporary Authorization Act
Savings and Loan Act
Which act created our central banking system?
19th Amendment
The Federal Reserve Act
The Sherman Antitrust Act
The Gimmie Money Act
Which of these best describes the Federal Reserve System (the Fed)?
It is a mostly independent agency that supervises and manages the financial system.
It is the agency through which Congress supervises and manages the financial system
It is the agency through which the judiciary supervises and manages the financial system.
It is the agency through which the executive branch supervises and manages the financial system.
What is the Federal Reserve aka FED's main concern?
Unemployment
Inflation
GDP
Happiness
The Federal Reserve is the ....
legislative branch of the USA
central bank of the USA
FOREX of the USA
place where all the gold in the USA is hidden
What is the Federal Reserve System commonly known as?
The Treasury
The Fed
The Executive Bank
The Central Department
An expansionary policy means that the Fed is attempting to
increase the size of the nation's money supply
decrease the size of the nation's money supply
Monetary Policy is the Federal Reserve Systems attempt to...
control the amount of money in circulation
control the Federal Government's debt
control state governments' spending
none of these answers are correct.
A contractionary policy means that the Fed is attempting to
increase the size of the nation's money supply
decrease the size of the nation's money supply
Which policy would help fight unemployment?
Expansionary
Contractionary
If the Fed wants to increase the cost of loans, then it should adjust...
Open Market Operations
The Reserve Ratio
The Discount Rate
During an expansion, the Fed should use...
an expansionary policy
a contractionary policy
The FED announces it will lower discount rates to banks. Why would the Fed take this action?
Fear economy is falling into a recession
Fear the economy is growing too rapidly
The Fed has a few of tools to control swings in the economy
all of these
Which monetary policy tool would be expansionary?
decrease reserve requirement to increse the money supply
increase discount rate to decrease the money supply
increase interest paid on reserves to decrease the money supply
selling bonds via open market operations to decrease the money supply
The buying and selling of government securities to alter the supply of money.
Open market operations
Monetary policy
Expansionary policies
Contractionary policies
If economy grows too rapidly, what is best option for the Fed consider for stabilizing economy?
increase reserve requirement
increase discount rate
sell U.S. Treasury Bonds
all of these
What are the effects of low interest rates?
more money circulates in the economy
less money circulates in the economy
Influencing the economy by changing the reserve requirement or the Discount Rate is called:
Fiscal policy
Monetary policy
Tight Money
Easy Money
Inflation is...
A general decrease in prices and rise in the purchasing value of money
A general increase in prices and fall in the purchasing value of money
A measure of how much unemployment there is in the country
What is the definition for inflation?
The market value of all final goods and services produced in a nation during a period of time, usually a year.
The increase of general prices over time.
When people do not have jobs and are actively looking for one.
What is the term length for a member of the Board of Governors of the Federal Reserve System?
4 years
10 years
14 years
20 years
Which of the following is a primary objective of the Federal Reserve?
Increasing government spending
Price stability
Reducing taxes
Promoting exports
Explain the role of the Security and Exchange Commission (SEC) in the financial system.
It sets the federal funds rate.
It regulates and enforces laws for securities markets.
It manages the national debt.
It controls the money supply.
How does the Federal Reserve use the discount rate as a tool of monetary policy?
By setting the rate at which it lends to commercial banks
By determining the interest rate on savings accounts
By controlling the stock market prices
By regulating international trade
Analyze how changes in the federal funds rate can impact maximum employment.
By directly increasing the number of jobs
By influencing borrowing costs and economic activity
By setting minimum wage levels
By controlling immigration policies
What is the primary function of the Federal Reserve's monetary policy tools?
To regulate international trade
To control inflation and stabilize the economy
To set tax rates
To manage government spending
Describe the relationship between the federal funds rate and the discount rate.
The federal funds rate is always higher than the discount rate.
The discount rate is set by the Federal Reserve, while the federal funds rate is determined by the market.
Both rates are set by the Treasury Department.
The federal funds rate is used to control inflation, while the discount rate is used to control unemployment.
Evaluate the impact of monetary policy on long-term interest rates.
It has no effect on long-term interest rates.
It can influence long-term interest rates through expectations and economic activity.
It directly sets long-term interest rates.
It only affects short-term interest rates.
Who is Adam Smith and what is he known for in the context of economics?
A Federal Reserve Chairman known for monetary policy
An economist known for his work on the theory of supply and demand
A politician known for tax reforms
A banker known for financial regulations
Discuss how the Federal Reserve's objective of financial system stability can affect economic growth.
By reducing the need for government intervention
By ensuring a stable environment for investment and economic activities
By increasing inflation rates
By decreasing the money supply
What is the term length for a member of the Board of Governors of the Federal Reserve System?
4 years
10 years
14 years
20 years
Which of the following is a primary objective of the Federal Reserve?
Increasing government spending
Price stability
Reducing taxes
Promoting exports
Explain the role of the Security and Exchange Commission (SEC) in the financial system.
It sets the federal funds rate.
It regulates and enforces laws for securities markets.
It manages the national debt.
It controls the money supply.
How does the Federal Reserve use the discount rate as a tool of monetary policy?
By setting the rate at which it lends to commercial banks
By determining the interest rate on savings accounts
By controlling the stock market prices
By regulating international trade
Analyze how changes in the federal funds rate can impact maximum employment.
By directly increasing the number of jobs
By influencing borrowing costs and economic activity
By setting minimum wage levels
By controlling immigration policies
What is the primary function of the Federal Reserve's monetary policy tools?
To regulate international trade
To control inflation and stabilize the economy
To set tax rates
To manage government spending
Describe the relationship between the federal funds rate and the discount rate.
The federal funds rate is always higher than the discount rate.
The discount rate is set by the Federal Reserve, while the federal funds rate is determined by the market.
Both rates are set by the Treasury Department.
The federal funds rate is used to control inflation, while the discount rate is used to control unemployment.
Evaluate the impact of monetary policy on long-term interest rates.
It has no effect on long-term interest rates.
It can influence long-term interest rates through expectations and economic activity.
It directly sets long-term interest rates.
It only affects short-term interest rates.
Who is Adam Smith and what is he known for in the context of economics?
A Federal Reserve Chairman known for monetary policy
An economist known for his work on the theory of supply and demand
A politician known for tax reforms
A banker known for financial regulations
Discuss how the Federal Reserve's objective of financial system stability can affect economic growth.
By reducing the need for government intervention
By ensuring a stable environment for investment and economic activities
By increasing inflation rates
By decreasing the money supply
