5.5 Monetary Policy: The Federal Reserve

Question 1

best

Revolt · Accepted Answer

limiting inflation and reducing unemployment

Question 2

The Fed’s use of open market operations affects banks’

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money available to lend.

Question 3

Why is the Fed often referred to as a “lender of last resort,” or the last lender to turn to in a crisis?

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It offers banks financial protection to keep consumers from panicking.

Question 4

What is a potential negative effect of an expansionary policy?

Revolt · Accepted Answer

increased inflation

Question 5

What is the full name of the US central bank, known as the Fed?

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the Federal Reserve Bank

Question 6

Federal Reserve interest federal fundsloan interest

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federal funds

Question 7

Which best describes a central bank's primary role?

Revolt · Accepted Answer

creating monetary policy

Question 8

Which of these is a banking activity of the Fed?

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storing money for banks

Question 9

best

Revolt · Accepted Answer

steer the economy away from recession and toward growth

5.5 Monetary Policy: The Federal Reserve Answers