During and After the Financial Crisis of 2007-2009,the Fed Greatly

question 10

Multiple Choice

During and after the financial crisis of 2007-2009,the Fed greatly increased the supply of reserves through three rounds of quantitative easing by

• A) sales of both long-term Treasury securities and mortgage-backed securities.
• B) sales of long-term Treasury securities and purchases of mortgage-backed securities.
• C) purchases of both long-term Treasury securities and mortgage-backed securities.
• D) purchases of long-term Treasury securities and sales of mortgage-backed securities.

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Definitions:

FIFO Method

"First In, First Out," an inventory valuation method where goods produced or acquired first are sold, used, or disposed of first.

Periodic System

An inventory system that updates inventory and cost of goods sold only at the end of the accounting period based on a physical count.

Ending Inventory

The value of goods available for sale at the end of an accounting period, calculated by adding purchases to beginning inventory and then subtracting the cost of goods sold.

Gross Profit

The difference between sales and the cost of goods sold before deducting overhead, payroll, taxation, and interest payments.