If the Fed Wanted to Keep Income at the Original

question 40

Multiple Choice

If the Fed wanted to keep income at the original level after a tax increase, it would need to

• A)buy government securities in open market operations
• B)sell government securities in open market operations
• C)raise reserve requirements
• D)raise the primary credit rate (the discount rate)
• E)raise the currency-deposit ratio

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Definitions:

Increasing Uncertainty

The situation in which the amount of unpredictability in the environment or the future outcomes of decisions is rising.

Managerial Experience

The accumulation of knowledge, skills, and expertise that an individual has acquired through holding managerial positions over time.

Managerial Experience

The accumulation of knowledge, skills, and insights gained through holding positions of responsibility for directing and controlling organizational units or projects.

Perceived Environment

Refers to how individuals interpret and understand the environments in which they find themselves, through subjective perception.