Which of the Following Is True About the Federal Reserve

question 129

Multiple Choice

Which of the following is true about the Federal Reserve and its ability to prevent recessions? The Federal Reserve

• A)does not try to eliminate recessions,but instead focuses on preventing inflation.
• B)can fine tune the economy and realistically hope to keep the economy from experiencing recessions.
• C)cannot realistically fine tune the economy,but seeks to keep recessions shorter and milder than they would otherwise be.
• D)cannot realistically fine tune the economy and has little to no effect on the magnitude and length of recessions.

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Definitions:

Schedule E

A form used by the IRS for taxpayers to report income and losses from rental property, royalties, partnerships, S corporations, estates, and trusts.

Royalties

Payments made to the owners of intellectual property, such as authors, composers, and inventors, for the rights to use their intellectual property.

Form 1099-MISC

A tax form used to report various types of income other than salaries, such as fees, royalties, and self-employment income.

Real Estate Professional

An individual who spends the majority of their working hours in real property businesses, meeting specific IRS criteria.