The Fed

question 350

Multiple Choice

The Fed

• A) has no influence on the exchange rate.
• B) allows a flexible exchange rate, though their actions can impact the exchange rate.
• C) sells U.S. dollars to China in an attempt to depreciate the U.S. dollar.
• D) alternates between a flexible, fixed, and crawling peg exchange rate policy depending on economic conditions.

---

Definitions:

Herfindahl Index

An indicator of company sizes within an industry, showing the level of competitive interaction among them.

Clayton Act

A U.S. antitrust law enacted in 1914 aimed at preventing monopolies and unfair business practices that may hinder competition.

Antitrust Authorities

Government agencies or bodies responsible for enforcing laws aimed at promoting competition and preventing monopolistic practices.

Corporate Merger

The combination of two or more companies into a single legal entity, often to achieve operational efficiencies or gain market share.