Which of the Following Is a Tool the Fed Uses

question 255

Multiple Choice

Which of the following is a tool the Fed uses to adjust the quantity of money?
i. The Fed can change the interest rate on loans to bank customers.
ii. The Fed can change the discount rate on loans to banks.
iii. The Fed can buy or sell government securities.

• A) i only
• B) ii only
• C) iii only
• D) i and iii
• E) ii and iii

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Definitions:

Joseph Stiglitz

An American economist and a professor at Columbia University, known for his critical view on the management of globalization and neoliberal policies.

IMF

The International Monetary Fund, an organization aimed at fostering global monetary cooperation and financial stability, facilitating international trade, and reducing poverty.

Economic Growth

Growth in an economy's goods and services production over a specific period, often assessed through the Gross Domestic Product.

IMF

The International Monetary Fund (IMF) is an international organization that aims to promote global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.