The Four Main Policy Tools the Federal Reserve System Uses

question 269

Multiple Choice

The four main policy tools the Federal Reserve System uses to influence the interest rate are setting

• A)the prime rate,open market operations,extraordinary crisis management and setting the excess reserve ratio.
• B)quantitative easing,market interest rate and the discount rate,as well as open market operations.
• C)the discount rate,open market operations,extraordinary crisis measures and setting the required reserve ratio.
• D)credit easing,the discount rate,setting tax rates,and setting the required reserve ratio.
• E)quantitative easing,open market operations,setting tax rates,and setting the required reserve ratio.

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Definitions:

Sapir-Whorf Thesis

A concept in linguistic anthropology suggesting that the structure of a language affects its speakers' perception and categorization of the world.

Rite of Passage

A ceremonial event marking an important stage in a person's life, such as birth, puberty, marriage, or death, often signifying a transition from one social status to another.

Cow Worship

The practice of venerating cows as sacred animals, particularly in Hindu culture, where cows are respected and honored.

Rural India

Areas in India that are characterized by lower population density, agricultural-based economy, and lesser access to healthcare, education, and technology compared to urban areas.