How Did the Fed's Conduct of Open Market Operations Change

question 190

Multiple Choice

How did the Fed's conduct of open market operations change during the economic crisis of 2008?

• A) Open market operations are no longer the most common tool that the Fed utilizes.
• B) The Fed now buys and sells a broader range of assets than only government securities.
• C) The Federal Open Market Committee cannot act without the approval of the Treasury.
• D) The Fed now must have adequate funds available before purchasing government securities.

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Definitions:

Total Assets Turnover

A financial metric that measures the efficiency of a company's use of its assets in generating sales revenue.

Equity Multiplier

A measure of a company's financial leverage, calculated as total assets divided by total equity.

Net Income

Net Income is the total earnings of a company after deducting all expenses, taxes, and costs, representing the profit earned during a specific period.

P/E Ratio

The Price-to-Earnings ratio compares a company's current share price to its per-share earnings, providing insight into how much investors are willing to pay per dollar of earnings.