The Explicit Functions Given to the Fed by the Congress

question 161

Multiple Choice

The explicit functions given to the Fed by the Congress include all of the following except:

• A)regulating financial institutions.
• B)serving as a lender of last resort to financial institutions.
• C)providing banking services to the U.S. government.
• D)holding the nominal interest rate no more than 2 percent above the real interest rate.

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Definitions:

Economic Expansions

Phases in the business cycle where the economy grows, marked by increased production, employment, and consumer spending.

World War II

A global conflict that lasted from 1939 to 1945, involving most of the world's nations, including all of the great powers, organized into two opposing military alliances.

Hyperinflation

An extremely high and typically accelerating inflation rate, causing a rapid erosion of currency's real value.

Deflation

A decrease in the general price level of goods and services, often indicating an economic decline.