Which one of these tasks is a role that the Fed has? Select one: a. Telling bank

Question

Which one of these tasks is a role that the Fed has?

Select one:

a. Telling banks what interest rates they must charge on mortgages (house loans)

b. Issuing new government bonds to increase government borrowing

c. Collecting taxes on behalf of the federal government

d. Regulating credit unions

e. Fixing the exchange rate between the Euro and the dollar

Using Internet surveys to collect data about production and unemployment is likely to reduce which one of these lags:

Select one:

a. The recognition lag

b. The chronicle lag

c. The legislative lag

d. The technology lag

e. The impact lag

Tim is paying for a fine for his speeding violation in court by using his debit card. Tim is using money as:

Select one:

a. A unit of standardization

b. A medium of penalization

c. A unit of account

d. A medium of exchange

e. A store of value

Assume that banks lend out all their excess reserves and individuals deposit all their money. If the Required Reserve Ratio is .20, what does the Fed have to do to decrease the supply of money by $400 billion?

Select one:

a. Sell $80 billion worth of government bonds

b. Sell $100 billion worth of government bonds

c. Buy $80 billion worth of government bonds

d. Buy $100 billion worth of government bonds

e. Buy $200 billion worth of government bonds

Explanation / Answer

1. The correct answer is A.

2. The correct answer is D.

3. The correct answer is D.

4. The correct answer is A.

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