The Tools at the Disposal of the Fed for Changing

question 528

Multiple Choice

The tools at the disposal of the Fed for changing the quantity of money do NOT include

• A) open market operations.
• B) changing the required reserve ratio.
• C) changing discount rates.
• D) increasing the number of commercial banks.

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Definitions:

Monetary Items

Assets and liabilities that are to be received or paid in a fixed or determinable amount of money.

Functional Currency

The main currency used by a business or economy, reflecting the primary economic environment in which it operates.

Shareholders' Equity

The residual interest in the assets of an entity that remains after deducting its liabilities, representing ownership value in the company.

Presentation Currency

The currency in which the financial statements of an entity are presented.