Question | Answer |
Oregon is in the _____ Federal Reserve District which has a Federal Reserve Bank in _______. | 12th; San Francisco |
Who is the current Chair of the Federal Reserve? | Jerome Powell |
What must the government do to reduce high inflation when it comes to spending and the money supply? | Decrease both spending and the money supply |
What tool does the Fed rely on the most in conducting policy? | open market operations (buying and selling bonds) |
If the FOMC decides to expand the money supply it would issue a directive to
(buy/ sell) government securities. | buy |
Who selects members of the Board of Governors of the Federal Reserve and how long are their terms? | The President for appoints them for 14-year terms |
Federal Open Market Committee consists of how many voting members? | 12 (the 7 Board of Governors and 5 of the 12 District bank presidents) |
Who controls the Federal Reserve system? | it is an independent agency controlled by the Board of Governors of the Federal Reserve |
What is the Federal Reserve system? | The central banking system for the United States |
The Federal Reserve is (controlled by/ independent of) Congress and the President. | independent |
When the Fed eases the money supply to create economic growth and lower unemployment, it may cause prices to (increase/ decrease). | increase |
To increase the money supply, the Fed should (raise/ lower) the discount rate. | lower |
To increase the money supply, the Fed should (raise/lower) the federal funds rate. | lower |
To fight unemployment, the Fed should (buy/sell) bonds. | buy |
To lower inflation, the Fed should (buy/ sell) bonds. | sell |
If GDP declines substantially, then the Fed should (increase/decrease) the money supply. | increase |
If the CPI (Consumer Price Index) and the PPI (producer Price Index) have risen sharply, then the Fed should (increase/decrease) the money supply. | decrease |
if we are experiencing a recession, then the Fed should (increase/decrease) the money supply. | increase |
If the economy is in contraction and businesses won't take out loans because of high interest rates then the Fed should (increase/decrease) the money supply. | increase |
If unemployment is high and prices are stable then the Fed should (increase/decrease) the money supply. | increase |
If inflation is high and unemployment is low, then the Fed should (increase/decrease) the money supply. | decrease |
What should the Fed do if neither unemployment or inflation is a problem? | do nothing |
What should the Fed do if the price of one product tripled? | do nothing |