Which List Represents Monetary Policy Actions That Are Consistent with One

question 232

Multiple Choice

Which list represents monetary policy actions that are consistent with one another?

• A) buy government bonds, raise reserve requirements, raise the discount rate
• B) sell government bonds, raise reserve requirements, lower the discount rate
• C) sell government bonds, lower reserve requirements, raise the discount rate
• D) buy government bonds, lower reserve requirements, lower the discount rate

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Definitions:

Amortization

The gradual reduction of the cost or value of an intangible asset over its useful life.

Bond Premium

The amount by which the market price of a bond exceeds its face value, typically occurring when the bond's interest rate is higher than the current market rate.

Issued

Refers to securities or other financial instruments that have been officially distributed to investors or the public.

Contract Rate

The agreed-upon interest rate specified in a contract, particularly in loan agreements or bond indentures.