When the Fed Alters the Types of Assets It Owns,it

question 101

Multiple Choice

When the Fed alters the types of assets it owns,it is engaging in

• A)credit easing.
• B)forward guidance.
• C)quantitative easing.
• D)changing the discount rate.

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Definitions:

Fixed-Rate Tax-Deferred

Describes investment accounts or financial products that accumulate earnings taxed at a later date instead of when they are earned, with a fixed interest rate.

Savings Plan

A program that allows individuals to allocate a portion of their income for long-term savings or investments.

Purchasing Power Risk

The risk that the value of money will decrease over time, eroding the real value of investments and returns.

Conservative Investment

An investment strategy that prioritizes the preservation of capital and a steady flow of income, typically involving lower-risk securities such as bonds or high-quality stocks.