1/if The Country Is Heading Into A Recession, The Fed Might Be Able To Counteract This By?

Answer
a. increasing the discount rate.
b. carrying out an expansionary fiscal policy.
c. forcing the government deficit to decrease.
d. acting to increase the money supply.
2/ The amount of reserves remaining after reserve requirements have been satisfied is called
Answer
a.the required reserve ratio.
b. legal reserves.
c. federal reserves.
d. excess reserves.
3/ Actual reserves minus required reserves equals
Answer
a. the required reserve ratio.
b. actual reserves.
c. vault cash plus deposits at Fed District Banks.
d. excess reserves.
4/ The liquidity trap is based on the _____ demand for money.
Answer
a. overall
b. transactions
c.precautionary
d. speculative
5/ The purpose of a tight money policy is to
Answer
a. alleviate recessions.
b. raise interest rates and restrict the availability of bank credit.
c. run budget surpluses.
d. increase investment spending.

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