During 2008-2013, the Fed Initiated Several Rounds of "Quantitative Easing

question 92

Multiple Choice

During 2008-2013, the Fed initiated several rounds of "quantitative easing."  Under this policy, the Fed

• A) increased its purchases of financial assets and thereby injected additional reserves into the banking system.
• B) increased its purchases of financial assets, which reduced the reserves available to the banking system.
• C) reduced its purchases of financial assets and thereby injected additional reserves into the banking system.
• D) reduced its purchases of financial assets and thereby reduced the quantity of reserves available to the banking system.

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Definitions:

Treble Damages

A legal principle allowing a court to triple the amount of the actual/compensatory damages to be awarded to a plaintiff.

Four-Firm Concentration

A measure of market concentration that evaluates the total market share of the four largest firms within an industry.

Standard Oil Case

A 1911 antitrust case in which Standard Oil was found guilty of violating the Sherman Act by illegally monopolizing the petroleum industry. As a remedy the company was divided into several competing firms.

Microsoft Case

A 2002 antitrust case in which Microsoft was found guilty of violating the Sherman Act by engaging in a series of unlawful activities designed to maintain its monopoly in operating systems for personal computers; as a remedy the company was prohibited from engaging in a set of specific anticompetitive business practices.