The Federal Reserve System Is

question 20

Multiple Choice

The Federal Reserve System is:

• A)a group of twelve commercial banks.
• B)the central bank of the United States.
• C)the agency of the U.S.government that insures commercial bank deposits.
• D)the branch of the U.S.Treasury that keeps the U.S.gold reserves.

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Definitions:

Breakeven Point

is the level of production or sales at which total revenues equal total costs, resulting in neither profit nor loss.

Business Risk

Variation in a company’s financial performance caused by changes in business conditions.

Operating Leverage

A financial ratio that measures the degree to which a firm or project can increase operating income by increasing revenue, highlighting the impact of fixed costs on profits.

Fixed Costs

Expenses that do not change with the level of goods or services produced by a business over a certain period.