Which Means Does the Fed Most Frequently Employ to Regulate

question 32

Multiple Choice

Which means does the Fed most frequently employ to regulate the money supply?

• A) changing the reserve requirement ratio
• B) changing the discount rate
• C) engaging in open market operations
• D) changing the fed funds rate
• E) printing new money

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Definitions:

Equilibrium Quantity

The amount of products or services available and sought after at the market's balance price.

Equilibrium Quantity

The quantity of goods or services supplied and demanded at the equilibrium price, where supply equals demand.

Excess Demand

A scenario in which the demand for a product or service surpasses the supply available at the existing price.

Surplus

An excess of production or supply over demand.