When the Federal Reserve Conducts Open-Market Operations to Increase the Money

question 116

Multiple Choice

When the Federal Reserve conducts open-market operations to increase the money supply,it

• A)redeems Federal Reserve notes.
• B)buys government bonds from the public.
• C)raises the discount rate.
• D)decreases its lending to member banks.

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Definitions:

Cost Estimation Methods

Techniques used to predict the expenses likely to be incurred in the manufacturing of a product or the execution of a project.

Cost Equation

An equation used to estimate costs, typically in the form of fixed costs plus variable costs times the number of units.

Variable Costs

Expenses that vary directly with the level of production or sales volume, such as materials and labor.

Pretax Income

The income that a company earns before any taxes are deducted, representing the profitability of the company before government intervention.