Which of the Following Statements Is True

question 29

Multiple Choice

Which of the following statements is true?

• A) While the Fed emphasizes money growth more than the ECB, both central banks have chosen interest rates as their operating target.
• B) While the Fed emphasizes money growth less than the ECB, both central banks have chosen interest rates as their operating target.
• C) Because the Fed emphasizes money growth less than the ECB, the Fed uses interest rates as their operating target while the ECB looks at growth in money aggregates.
• D) Both the Fed and the ECB use growth in money aggregates as their operating target.

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Definitions:

Government Securities

Financial instruments issued by a government to raise funds from investors, promising to pay back with interest, including treasury bonds, bills, and notes considered low-risk investments.

Federal Reserve Board

The governing body of the Federal Reserve System, responsible for overseeing the U.S. central banking system.

Government Securities

Financial instruments issued by a government to raise funds from the public, including bonds and treasury bills, with a promise to pay back with interest.

Securities

Assets that denote a share in the equity of a corporation available on the public market (stock), a lending agreement with a government or corporate body (bond), or ownership claims evidenced by an option.