When the Fed Conducts Open Market Operations, It

question 308

Multiple Choice

When the Fed conducts open market operations, it

• A) purchases or sells government bonds issued by the U.S. Treasury.
• B) is engaging in fiscal policy.
• C) also raises taxes at the same time.
• D) shifts the demand for money curve.

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Definitions:

Levels-of-processing Model

A theory suggesting that the depth of mental processing affects memory recall, with deeper processing resulting in longer-lasting memory.

Information-processing Approach

A view in cognitive psychology that likens the mind to a computer in terms of how information is encoded, stored, and retrieved.

Atkinson-Shiffrin Model

A theory of human memory that was proposed in the 1960s, suggesting that memory consists of three main components: sensory memory, short-term memory, and long-term memory.

Maintenance Rehearsal

A cognitive process involving the repetitive review of information to keep it in short-term memory for extended periods.