A Decrease in Consumer Confidence Can Put Your Job at Risk

question 204

Multiple Choice

A decrease in consumer confidence can put your job at risk if

• A)aggregate expenditures fall.
• B)consumers expect their incomes to rise in the future.
• C)aggregate expenditures rise.
• D)consumers expect firms to increase investment in the future.

---

Definitions:

Federal Reserve

The central banking system of the United States, responsible for monetary policy, including regulating banks, managing the country's money supply, and stabilizing the financial system.

Reserve Requirement

The portion of depositors' balances that banks must have on hand as cash, ensuring banks can meet withdrawal demands.

Money Supply

The total amount of monetary assets available in an economy at a specific time, influencing inflation and economic stability.

Bank Reserves

The portion of deposits that banks are required to hold either in cash in their vaults or on deposit with a central bank, as a precaution to ensure bank liquidity.