Which of the Following Is True Regarding the Reserve Requirements

question 16

Multiple Choice

Which of the following is true regarding the reserve requirements?

• A) The Fed changes them frequently because they are a power monetary policy tool.
• B) The Fed does not change them much at all because taxation is a more impactful monetary policy tool.
• C) The Fed changes them frequently because doing so simplifies banking operations.
• D) The Fed does not change them much at all because doing so would make banking operations difficult.

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Definitions:

Commerce Clause

A provision in the United States Constitution (Article I, Section 8, Clause 3) that grants Congress the power to regulate commerce with foreign nations, and among the several states, and with the Indian tribes.

Constitution

The fundamental principles or established precedents according to which a state or other organization is governed.

Implied Power

Powers not explicitly stated but that are necessary and proper for carrying out the expressly granted powers.

Expressly Designated Powers

Specific powers given to an individual or body directly and clearly in a legal document or statute.