Econ lowdown In Plain English

How many districts are there in the Federal Reserve System?

12

How long is the term of a Federal Reserve governor?

14 years

When was the Federal Reserve established?

1913

What is the Federal Reserve's chief body for monetary policy?

FOMC

Which would most closely reflect the strategy of price stability of the Federal Reserve?

an inflation rate that remains steady at 2 percent

How are members of the Board of Governors chosen?

appointed by the president of the United States, confirmed by the us senate

The interest rate Reserve Banks charge commercial banks for short-term loans is the

discount rate

Imagine this scenario: the inflation rate has fallen from 4 percent to 1 percent. How would you label this change in price level?

disinflation

While it does not directly set this rate, the Federal Open Market Committee (FOMC) set a target for which of the following rates?

federal funds rate

All but one president of the regional Reserve Banks rotates a voting position on the Federal Open Market Committee (FOMC). Which president has permanent voting privileges?

federal reserve bank of new york

What is the Federal Reserve's most frequently used tool for conducting monetary policy?

open market operations

Which of the following is not a monetary policy tool used by the Federal Reserve?

prime rate

The Federal Reserve is audited on an annual basis.

true

How many voting members are on the FOMC?

7

Which of the following is not one of the three responsibilities of the Federal Reserve System?

lending money to consumers

Which part of the Federal Reserve System serves the daily needs of banks across the country?

reserve banks

Which actions would the FOMC likely take if it were to pursue contractionary monetary policy using open market operations?

sell government securities