MCQ Questions
Q.1.
Which statement best describes how the Fed responds to recessions?
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    It increases the money supply.
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    Regulations keep prices fair and prevent businesses from establishing monopolies.
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    storing money for banks
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    increased inflation
Q.2.
Which is a function of regulatory agencies?
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    limiting inflation and reducing unemployment
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    It increases the money supply.
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    storing money for banks
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    encouraging business compliance
Q.3.
What is a potential negative effect of an expansionary policy?
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    storing money for banks
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    It increases the money supply.
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    encouraging business compliance
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    increased inflation
Q.4.
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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    Regulations keep prices fair and prevent businesses from establishing monopolies.
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    steer the economy away from recession and toward growth
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    It offers banks financial protection to keep consumers from panicking.
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    It is interest on money held in reserve.
Q.5.
Which best describes what a central bank uses monetary policy to do?
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    It increases the money supply.
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    limiting inflation and reducing unemployment
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    steer the economy away from recession and toward growth
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    Regulations keep prices fair and prevent businesses from establishing monopolies.
Q.6.
In how many cities are Federal Reserve district banks located?
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    12
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    borrowing.
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    It increases the money supply.
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    increased inflation
Q.7.
Which best describes a central bank's primary goals?
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    storing money for banks
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    steer the economy away from recession and toward growth
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    encouraging business compliance
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    limiting inflation and reducing unemployment
Q.8.
Which statement explains how regulations on prices affect business practices?
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    steer the economy away from recession and toward growth
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    Regulations keep prices fair and prevent businesses from establishing monopolies.
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    It increases the money supply.
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    limiting inflation and reducing unemployment
Q.9.
the Federal Reserve Bank
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    What is a potential negative effect of an expansionary policy?
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    What is the full name of the US central bank, known as the Fed?
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    Which of these is a banking activity of the Fed?
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    Which statement best describes how the Fed responds to recessions?
Q.10.
to set aside or hold for another
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    central bank
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    reserve
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    implement
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    securities
Q.11.
reducing unemployment and maintaining cash flow
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    Which of these is a banking activity of the Fed?
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    Which best describes a central bank's primary goals?
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    Which statement best describes how the Fed responds to recessions?
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    Which best describes what a central bank uses monetary policy to do?
Q.12.
Interest rates will likely decrease.
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    Which best describes what a central bank uses monetary policy to do?
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    Which statement describes how borrowers will most likely benefit when the Fed reduces reserve requirements?
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    Which statement best describes how the Fed responds to recessions?
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    Which statement best describes how the Fed's use of open market operations affects banks?
Q.13.
....liquidity.
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    Economists studying the money supply categorize the status of the money based on....
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    What is a potential negative effect of an expansionary policy?
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    What is the full name of the US central bank, known as the Fed?
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    Which statement best describes how the Fed's use of open market operations affects banks?
Q.14.
It affects banks' liquidity.
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    Which statement describes how borrowers will most likely benefit when the Fed reduces reserve requirements?
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    Which statement best describes how the Fed responds to recessions?
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    Which of these is a banking activity of the Fed?
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    Which statement best describes how the Fed's use of open market operations affects banks?
Q.15.
use to complete a specific action
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    implement
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    reserve
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    securities
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    Which statement describes how borrowers will most likely benefit when the Fed reduces reserve requirements?
Q.16.
steer the economy away from recession and toward growth
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    Which statement describes how borrowers will most likely benefit when the Fed reduces reserve requirements?
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    Which statement best describes how the Fed responds to recessions?
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    Which best describes a central bank's primary goals?
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    Which best describes what a central bank uses monetary policy to do?
Q.17.
storing money for banks
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    Which statement best describes how the Fed responds to recessions?
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    Which best describes a central bank's primary goals?
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    What is the full name of the US central bank, known as the Fed?
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    Which of these is a banking activity of the Fed?
Q.18.
creating monetary policy
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    Which of these is a banking activity of the Fed?
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    Which best describes a central bank's primary role?
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    Which best describes a central bank's primary goals?
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    Which best describes what a central bank uses monetary policy to do?