If the Fed Wanted to Reduce the Federal Funds Interest

question 135

Multiple Choice

If the Fed wanted to reduce the federal funds interest rate, it might:​

• A)​decrease the interest rate it pays on bank reserves.
• B)​decrease the required reserve ratio.
• C)​buy government securities.
• D)​Do any of the above.

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Definitions:

Skill Transferability

The ease with which people can shift their work talents from one job, region, or country to another job, region, or country.

Net Benefits

The total positive outcomes or advantages derived from a particular action, subtracting any associated costs or negative effects.

Wage Rates

The standard amount of compensation individuals receive in exchange for their labor or services, measured per hour or unit of work.

Strictly by Wage Differentials

Determination of employment patterns solely based on variations in wage rates across different sectors or regions.