Traditionally, the Fed Often Communicated Its Intentions to Restrict or Expand

question 59

Multiple Choice

Traditionally, the Fed often communicated its intentions to restrict or expand monetary policy by announcing a change in its target for the

• A) prime rate.
• B) federal funds rate.
• C) discount rate.
• D) consumer price index.

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Definitions:

Revenue

The income generated from normal business operations and includes discounts and deductions for returned merchandise.

Consumer Sovereignty

The principle that the consumer's preferences determine the production of goods and services within an economy.

Market System

An economic system where decisions regarding investment, production, and distribution are guided by the forces of supply and demand and prices mediate transactions.

Production Decisions

The process of determining what goods or services to produce, how much, and by what method.