The Fed Tends Not to Use Discount Policy as Its

question 34

Multiple Choice

The Fed tends not to use discount policy as its principal tool in influencing the money supply since

• A)discount loans do not affect the money supply.
• B)it does not have as much control over discount loans as it has on open market operations.
• C)it is prohibited from doing so by an act of Congress.
• D)it prefers to use reserve requirements.

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Definitions:

Credential Inflation

The devaluation of educational qualifications over time, requiring higher levels of education to qualify for certain jobs.

Cultural Capital

Non-financial social assets that promote social mobility beyond economic means, including education, intellect, style of speech, and appearance.

Professionalization

The process by which an occupation transforms into a profession, typically involving the development of formal training programs, ethical standards, and officially recognized certification.

Protestantism

A branch of Christianity originating from the Reformation in the 16th century, emphasizing salvation through faith alone, the priesthood of all believers, and the authority of the Bible.