Question 1

The voting members of the Federal Open Market Committee consists of the

Accepted Answer

The voting members of the FOMC are seven members of the Board of Governors of the Federal Reserve System and five of the 12 Federal Reserve Bank presidents. This means that there are 12 voting members in total.

Question 2

The Federal Reserve System is organized into ________ Federal Reserve districts.

Accepted Answer

The Federal Reserve System is organized into 12 Federal Reserve districts, each with its own Federal Reserve Bank. The districts cover different regions of the United States and are responsible for carrying out the policies of the Federal Reserve System in their respective geographic areas.

Question 3

________ the quantity of money in the United States.

Accepted Answer

The Federal Reserve System is responsible for regulating the quantity of money in the United States through its monetary policy decisions, such as setting interest rates and controlling the money supply. The other options listed do not have the authority or responsibility to regulate the quantity of money in the US.

Question 4

The Federal Open Market Committee is

Accepted Answer

The Federal Open Market Committee (FOMC) is the main policy-making body of the Federal Reserve System. It is responsible for conducting monetary policy by setting the target for the federal funds rate and making decisions regarding the purchase and sale of government securities in the open market. The FOMC consists of the seven members of the Board of Governors and five of the 12 Federal Reserve Bank presidents.

Question 5

The four main policy tools the Federal Reserve System uses to influence the interest rate are setting

Accepted Answer

The answer of The four main policy tools the Federal...

Question 6

The Board of Governors of the Federal Reserve System has

Accepted Answer

The answer of The Board of Governors of the Federal...

Question 7

Which of the following Federal Reserve banks carries out the decisions of the FOMC?

Accepted Answer

The New York Federal Reserve bank carries out the decisions of the Federal Open Market Committee (FOMC) because it is responsible for executing monetary policy operations, such as buying and selling securities, to implement the FOMC's decisions. It also serves as the primary contact for foreign central banks and governments.

Question 8

What is the central bank of the United States?

Accepted Answer

The Federal Reserve System, commonly known as the "Fed," is the central banking system of the United States. It was created in 1913 by Congress to provide the country with a stable, flexible, and stable monetary and financial system. The Federal Reserve System consists of twelve regional Federal Reserve Banks located in major cities throughout the country, along with a Board of Governors based in Washington, D.C.

Question 9

The main policymaking committee of the Federal Reserve System is the

Accepted Answer

The Federal Open Market Committee (FOMC) is the main policymaking committee of the Federal Reserve System. It is responsible for setting monetary policy in the United States, including decisions on interest rates and the supply of money in the economy.

Question 10

Which of the following is NOT one of the Fed's monetary policy tools?

Accepted Answer

The coupon rate is not a monetary policy tool used by the Fed, but rather a predetermined interest rate set on a bond at the time of issuance. The other options (A, B, D, E) are all tools the Fed uses to implement monetary policy.

Question 11

The main policy making body of the Federal Reserve System is the

Accepted Answer

The Federal Open Market Committee (FOMC) is the main policy-making body of the Federal Reserve System. It consists of 12 members, including the seven members of the Board of Governors of the Federal Reserve System and the presidents of the 12 Federal Reserve Banks. The FOMC is responsible for setting monetary policy in the United States, including decisions on interest rates and the supply of money and credit in the economy.

Question 12

The Federal Reserve System is organized into

Accepted Answer

The Federal Reserve System is organized into 12 districts, dividing up the United States. Each district has its own Federal Reserve Bank, which is responsible for implementing monetary policy and providing services to banks in the district. The districts are based on geographic regions and are numbered from 1 to 12, with each district covering several states.

Question 13

In order to influence the interest rate, the Federal Reserve System can immediately adjust the

Accepted Answer

By adjusting the reserves of the banking system, the Federal Reserve can change the amount of money that banks have available to lend out. This, in turn, can affect the interest rates that banks charge for loans. If the Fed increases the reserves, banks will have more money to lend, which can lead to lower interest rates. If the Fed decreases reserves, banks will have less money to lend, which can lead to higher interest rates. Therefore, A is the best choice.

Question 14

The Federal Open Market Committee consists of

Accepted Answer

The Federal Open Market Committee consists of 12 members, seven of whom are the members of the Board of Governors and five of whom are presidents of Federal Reserve banks.

Question 15

Which of the following is a tool the Federal Reserve System can use to regulate the quantity of money?
I. changing the discount rate
Ii. conducting open market operations
Iii. changing the required reserve ratio

Accepted Answer

The Federal Reserve System can use all three tools - changing the discount rate, conducting open market operations, and changing the required reserve ratio - to regulate the quantity of money in the economy. Therefore, the correct answer is E.

Question 16

The Board of Governors of the Federal Reserve is

Accepted Answer

The Board of Governors of the Federal Reserve is a seven-member board, each serving a 14-year term. They are appointed by the President and confirmed by the Senate. The Board is the main policy-making body of the Fed and is responsible for the supervision and regulation of banks within the Federal Reserve system.

Question 17

Conducting the nation's monetary policy is the duty of the

Accepted Answer

The Federal Reserve System is responsible for conducting the nation's monetary policy. The Department of Commerce is primarily focused on promoting economic growth, and the U.S. Treasury department is responsible for managing the government's finances. The Federation of Banks and the Federal Bank Supervisor do not exist as official entities.

Question 18

The Board of Governors has

Accepted Answer

The Board of Governors has seven members appointed to 14-year terms. This ensures that the board has consistent leadership and is not subjected to frequent turnover, leading to stability in its operations.

Question 19

Who regulates the quantity of money circulating in the economy?

Accepted Answer

The Federal Reserve is responsible for regulating the quantity of money circulating in the economy through its monetary policy tools. This includes setting interest rates, adjusting the reserve requirement for banks, and buying or selling government securities on the open market. The other options do not have direct control over the quantity of money in circulation.

Question 20

All of the following are elements in the structure of the Fed EXCEPT the

Accepted Answer

The Executive Council to the Governor is not an element in the structure of the Federal Reserve (Fed). The other choices are all key elements of the Fed's structure: the Federal Open Market Committee (FOMC) sets monetary policy, the 12 Federal Reserve banks implement policy and provide financial services, the Board of Governors oversees the Fed's operations and policymaking, and the presidents of the 12 Federal Reserve banks participate in FOMC meetings and provide regional economic information to inform policy decisions.

Quiz 18: Money and the Monetary System