Which of the Following Monetary Policy Tools Was Introduced in 2008

question 265

Multiple Choice

Which of the following monetary policy tools was introduced in 2008?

• A)the discount rate
• B)the federal funds rate
• C)open-market operations
• D)paying interest on excess reserves held at the Fed

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Definitions:

Utility Maximization

The principle that individuals or firms seek to allocate their resources in a manner that maximizes their satisfaction or utility.

Money Income

Money income is the total amount of money earnings received by an individual or household, including wages, salaries, benefits, and investment income, before any deductions.

Marginal Utility

The additional satisfaction or utility a consumer receives from consuming one additional unit of a good or service.

Consumer Equilibrium

occurs when a consumer has allocated their resources in such a way that maximizes their utility, given their budget constraint.