Other Significant Entities Contributing to Federal Reserve Functions
What will be an ideal response?
Two other groups play important roles in the Federal Reserve System's core functions:
depository institutions--banks, thrifts, and credit unions; and
Federal Reserve System advisory committees, which make recommendations to the Board of Governors and to the Reserve Banks regarding the System's responsibilities.
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The AD curve shows the sum of
A) the price level, employment, and real GDP. B) consumption expenditure, investment, and real GDP. C) consumption expenditure, investment, government expenditures on goods and services, and net exports. D) consumption expenditure, investment, the price level, and real GDP.
If policymakers attempt to offset a favorable inflation shock with monetary ________, the resulting long-run equilibrium will be at ________ inflation rate compared to allowing the self-correcting mechanism return the economy to potential output.
A. tightening; a lower B. tightening; a higher C. easing; a lower D. easing; a higher
Considering the euro/U.S. dollar exchange rate, as a U.S. dollar increases in value versus the euro (holding other factors constant):
A. American goods become relatively less expensive than foreign goods. B. foreign goods become relatively less expensive than American goods. C. we would expect the supply curve of dollars to slope downward. D. foreign assets become relatively more expensive than American assets.
What are sticky prices, and how can contracts make them "sticky"?
What will be an ideal response?