Which of the Following Is True

question 65

Multiple Choice

Which of the following is true?

• A)A side effect of the Fed's greater openness is that a larger volume of open market operations is needed to hit a given fed funds rate target.
• B)The Fed believes that if it better communicates current and future policy moves, there will be less uncertainty.
• C)The Fed uses M1 primarily in the execution of monetary policy because it is the aggregate most widely used to make transactions.
• D)The Fed has become more secretive in recent years.

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Definitions:

Firm

A business organization, such as a corporation or partnership, which sells goods or services in exchange for money.

Producer Surplus

The difference between the amount producers are willing to accept for a good or service versus what they actually receive, usually a measure of profit.

Market Price

The price at which a service or asset is presently traded in a given market.

Full Cost

Full cost involves calculating the total cost of production, including both fixed and variable costs, to assess the overall expenses incurred by a business.