As a Result of Policy Actions Taken by the Fed

question 332

Multiple Choice

As a result of policy actions taken by the Fed since 2008, it (the Fed) can no longer expect to affect the federal funds rate through traditional open market operations to alter the overall amount of excess reserves in the banking system. This is because

• A) Congress has taken this power away from the Fed.
• B) there is a massive amount of excess reserves already in the banking system.
• C) the federal funds rate has become rigidly fixed by law.
• D) banks are no longer holding any excess reserves.

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Definitions:

Theory of Planned Behavior

A psychological theory that predicts an individual's intention to engage in a behavior at a specific time and place, based on attitudes, subjective norms, and perceived behavioral control.

Moral Norm

Standards of behavior based on beliefs about what is right and wrong, guiding social conduct.

Self-efficacy

An individual's belief in their own capability to execute behaviors necessary to produce specific performance attainments.

Healthy Lifestyle Change

Modifications or adaptations made to one's behavior, diet, and activities aimed at improving health and well-being.