The Federal Reserve System

question 46

Multiple Choice

The Federal Reserve System:

• A) was created by and is owned by the government.
• B) pursues independent fiscal policy at the behest of Congress.
• C) never acts to control inflation.
• D) pursues an independent monetary policy which can conflict with the government's economic policy.

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Definitions:

Rate Of Return

The financial increment or decrement experienced in the value of an investment over a specific duration, highlighted as a percentage of the initial capital deployed.

Business Venture

A new enterprise entered into for profit, often characterized by innovation, risk, and a new market or product.

Compounded Semi-annually

The process of calculating interest on both the initial principal and the accumulated interest from previous periods twice a year.

EAR

Effective Annual Rate is the actual return on an investment or the actual interest rate of a loan, taking into account the effect of compounding interest over the period.