In the 1970s,the Government Attempted to Regulate Prices to Control

question 81

Multiple Choice

In the 1970s,the government attempted to regulate prices to control inflation; this attempt was unsuccessful.The most likely reason was that

• A) it increased menu costs.
• B) it created future price certainty.
• C) it removed relative price signals for those items that had actual increases in demand that were not due to inflation.
• D) it created money illusion.
• E) the Watergate break-in destroyed Americans' faith in the government.

Assess the impact of changing reserve requirements on the banking system and money supply.

Understand the role of check clearing in the banking system.

Comprehend the effects of Federal Reserve policies on inflation and economic recession.

Understand the basic mechanics of money transfer between banks and its impact on bank reserves.

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Definitions:

Rational Mind

An awareness of reality, which allows you to ponder and reflect.

Emotional Mind

A state of mind characterized by emotion-driven thoughts and behaviors, as opposed to logic or reasoned thinking.

Games

Structured forms of play, usually undertaken for enjoyment, entertainment, or sometimes as a tool for education.

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Features or qualities that serve to identify or distinguish someone or something.