To Peg the Interest Rate Below Its Equilibrium Level, the Fed

question 12

Multiple Choice

To peg the interest rate below its equilibrium level, the Fed must

• A)sell securities to drive security market prices up.
• B)sell securities to drive security market prices down.
• C)buy securities to drive security market prices up.
• D)buy securities to drive security market prices down.

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Definitions:

Cultural Relativism

Is the belief that all cultures have equal value.

Ethnocentrism

The tendency to judge other cultures exclusively by the standards of one’s own.

Pluralism

Is the retention of racial and ethnic culture combined with equal access to basic social resources.

Universalism

A philosophical and theological concept that some ideas have universal application or applicability.