Which of the Following Can the Fed Do to Change

question 26

Multiple Choice

Which of the following can the Fed do to change the money supply?

• A)change reserves or change the reserve ratio
• B)change reserves but not change the reserve ratio
• C)change the reserve ratio but not change the reserve ratio
• D)neither change reserves nor change the reserve ratio

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Definitions:

Unsystematic Risk

The type of risk that is specific to a company or industry, which can be minimized through diversification.

Economic Slowdown

A period of reduced economic activity characterized by lower GDP growth, decreased consumer spending, and higher unemployment rates.

Lawsuit

A legal action brought by one party against another, typically in a court of law.

Dividend Adjustment

An alteration made to the dividend payout received by shareholders of a mutual fund or an index reflecting a change in the underlying stocks' dividend payouts.