I. Moral suasion
II. Changing the discount rate
III. Changing the reserve requirement
IV. Changing the prime interest rate
A. I, II, III, IV
B. II, III, IV
C. I, III
D. I, II, III
The tools of the Federal Reserve include all the above except changing the prime interest rate. The prime interest rate is set by banks. To be sure, the practices and policies of the Fed affect the prime, but the Fed does not set that rate. The Fed also employs the operations of the FOMC, and Regulation "T" in its efforts. For more help see moral suasion, and our Series 7 Exam Prep.
Correct answer: d. I, II, III
Find out more about the yield curve, what the yield curve is and how to create the yield curve for U.S. Treasury bonds using ...
Find out more about the yield curve and yield curve formations, what yield curves measure and the three main types of yield ...
Find out more about the multiplier effect, what it measures and what a large multiplier effect indicates about an economy.
Discover the criterion for taking a simple random sample, in contrast to a systematic random sample, each person selected ...
A risk that an insurance company is required to provide coverage ...
A service of the U.S. Department of State that lets U.S. citizens ...
A deflationary spiral is when a period of decreasing prices (deflation) ...
A negative interest rate policy (NIRP) is an unconventional monetary ...
A Trusted Traveler Program that allows pre-screened U.S. and ...
A U.S. program giving pre-approved travelers a faster Customs ...