Econ ch 34

When the federal reserve acts to ease money and credit in the economy, then the aggregate

Demand curve will shift to the right

Which one of the following is to be a tool of monetary?

Discount rate

The conduct of monetary policy in the United States is the main responsibility of the:

Federal reserve

The use of monetary policy to address a problem of recession or inflation is

Hindered by a lag in the time it takes for the policy to have an effect

A contraction of the money supply

Increases the interest rate and decreases aggregate demand

The asset demand for money and the rate of interest are:

Inversely related

Who is the current chairman of the federal reserve board of governors?

Janet yellen

Bond prices and interest rates are

Negatively related

The most frequently used monetary device for achieving price stability is:

Open-market operations

The most frequently used tool of monetary policy is:

Open-market operations

Which one of the following is a tool for monetary policy?

Open-market operations

Which one of the following is a tool of monetary policy for altering the reserves of commercial banks?

Open-market operations

Which one of the following is a tool of monetary policy for altering the reserves of commercial banks?

Reserve ratio

Which one of the following is a tool of monetary policy?

Reserve ratio

The economy is experiencing inflation and the federal reserve decides to pursue a restrictive money policy. Which actions by the fed would be most consistent with this policy?

Selling government securities

The fundamental objective of monetary policy is to assist the economy in achieving

A full-employment, noninflationary level of total output

In the consolidation balance sheet of the federal reserve banks, loans to commercial banks are:

An asset of the federal reserve banks and a liability for commercial banks

If federal reserve officials attempt to pull the economy out of a recession when the price level is relatively stable, the policies they would most likely use would be to:

Buy government securities and decrease the discount rate

Which statement is true?

The prime interest rate will be higher than the federal funds rate.

When the interest rate falls the

Total amount of money demanded for increases

A consumer holds money to meet spending needs. This would be an example of the

Transactions demand for money