The Tools of Monetary Policy Include

question 23

Multiple Choice

The tools of monetary policy include:

• A)the target federal funds rate.
• B)the excess reserve rate.
• C)the currency-to-deposit ratio.
• D)both the excess reserve rate and the target federal funds rate.

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Definitions:

Fair Value Adjustment

A financial accounting process of adjusting the fair market value of assets and liabilities.

Unrealized Loss

A decrease in the value of an investment that has not yet been sold and thus, the loss has not been realized.

Gain on Sale of Investment

The profit realized from selling an investment for more than its purchase cost.

Fair Value

The estimated market value of an asset or liability based on current prices in an open and competitive market.