Question 1

The Federal Open Market Committee meets

Accepted Answer

A) once a month. 
B) eight times a year. 
C) four times a year. 
D) semi-annually. 
A) once a month. 
B) eight times a year. 
C) four times a year. 
D) semi-annually.

Question 2

When someone asks how much money you made this year, they are using the term "money" correctly.

Accepted Answer

A) True 
 B)False

Question 3

The Fed cannot predict the effects of open-market operations with perfect accuracy because of

Accepted Answer

A) changes in people's desires for cash. 
B) foreigners desire to hold U.S.dollars. 
C) banks' desires to hold excess reserves. 
D) all of the above are correct. 
A) changes in people's desires for cash. 
B) foreigners desire to hold U.S.dollars. 
C) banks' desires to hold excess reserves. 
D) all of the above are correct.

Question 4

When the Fed buys a Treasury bill from the public, how does it usually pay for the T-bill?

Accepted Answer

A) By writing a check on a commercial bank account 
B) By printing new Federal Reserve notes 
C) By creating new reserves in bank accounts 
D) By prepaying taxes into the Treasury's account 
A) By writing a check on a commercial bank account 
B) By printing new Federal Reserve notes 
C) By creating new reserves in bank accounts 
D) By prepaying taxes into the Treasury's account

Question 5

The immediate impetus for the establishment of the Federal Reserve System came from

Accepted Answer

A) severe outbreaks of inflation in the early 1900s. 
B) four severe banking panics between 1873 and 1907. 
C) the discovery of gold in Alaska. 
D) the desire to copy the founding of the Bank of England. 
A) severe outbreaks of inflation in the early 1900s. 
B) four severe banking panics between 1873 and 1907. 
C) the discovery of gold in Alaska. 
D) the desire to copy the founding of the Bank of England.

Question 6

As the federal funds rate rises, the banks' opportunity cost of holding excess reserves falls.

Accepted Answer

A) True 
 B)False

Question 7

The main purpose of expansionary monetary policy is to reduce interest rates.

Accepted Answer

A) True 
 B)False

Question 8

At higher interest rates, banks will want to hold more reserves.

Accepted Answer

A) True 
 B)False

Exam 29: Monetary Policy: Conventional and Unconventional

The Federal Open Market Committee meets

When someone asks how much money you made this year, they are using the term "money" correctly.

The Fed cannot predict the effects of open-market operations with perfect accuracy because of

When the Fed buys a Treasury bill from the public, how does it usually pay for the T-bill?

The immediate impetus for the establishment of the Federal Reserve System came from

As the federal funds rate rises, the banks' opportunity cost of holding excess reserves falls.

The main purpose of expansionary monetary policy is to reduce interest rates.

At higher interest rates, banks will want to hold more reserves.

What Is Economics

The Economony: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: an Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production, Inputs, and Cost: Building Blocks for Supply Analysis

Output, Price, and Profit: the Importance of Marginal Analysis

The Financial Markets and the Economy: the Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

The Case for Free Markets: the Price System

Monopoly

Between Competition and Monopoly

Limiting Market Power: Antitrust and Regulation

The Shortcomings of Free Markets

The Economics of the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: the Human Inputs

Poverty, Inequality, and Discrimination

An Introduction to Macroeconomics

The Goals of Macroeconomic Policy

Economic Growth: Theory and Policy

Aggregate Demand and the Powerful Consumer

Demand-Side Equilibrium: Unemployment or Inflation

Bringing in the Supply Side: Unemployment and Inflation

Managing Aggregate Demand: Fiscal Policy

Money and the Banking System

The Financial Crisis and the Great Recession

The Debate Over Monetary and Fiscal Policy

Budget Deficits in the Short and Long Run

The Trade-Off Between Inflation and Unemployment

International Trade and Comparative Advantage

The International Monetary System: Order or Disorder

Exchange Rates and the Macroeconomy

Contemporary Issues in the Useconomy

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