If Indicators Like Weak Demand and Falling Commodity Prices Caused

question 60

Multiple Choice

If indicators like weak demand and falling commodity prices caused concern about deflation (falling prices) , what could the Fed do to head off the deflationary threat?

• A) increase the reserve requirements imposed on banks
• B) buy bonds in order to expand the money supply
• C) increase the discount rate
• D) increase the national debt

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Definitions:

Thalamus

In vertebrates, the portion of the diencephalon that passes on selected sensory information to the cerebrum.

Cerebrospinal Fluid

A clear, colorless body fluid found in the brain and spinal cord, playing a critical role in protecting these structures and maintaining their environment.

Ventricles

Chambers of the heart that receive blood from the atria and contract to propel blood out of the heart into the arteries.

Broca's Area

A region in the frontal lobe of the brain that is involved in language processing, speech production, and comprehension.