Exam 5: Policy Makers and the Money Supply

The velocity of money is expressed as the average number of times each dollar is spend on purchases of goods and services,and it is calculated as real GDP divided by M1.

One factor that decreases the volume of bank reserves is a decrease in:

The primary types of policy decisions used by policy makers to achieve economic objectives include trade policy,exchange rate policy,and regulatory decisions.

The U.S.banking system has the ability to alter the size of the money supply because of the use of:

The fiscal policy effects of a tax cut occur more slowly than an increase in government spending.

Special Drawing Rights are a form of reserve asset or paper gold created by the:

The velocity of money measures the rate at which wire transfers can be transmitted to overseas banks.

The larger the budget deficit,the more total spending there will be.

The budget-making process rests with the:

U.S.debt management is generally designed to:

Nations that export more than they import will have a trade deficit.

Although unemployment represents a loss of potential output,most economists agree that the real costs of unemployment to an economy are minimal.

The "perfect financial storm" that developed in 2008,which put the U.S.economy was on the verge of collapse was characterized by all of the following EXCEPT:

A country's economic policy actions are directed toward all of the following goals EXCEPT:

Which of the following statements is most correct?

Transactions that affect bank reserves can be initiated by the:

In an effort to stimulate economic activity,Congress and the president passed the $787 billion _________________________________ in February,2009 with the funds to be used to provide tax relief,appropriations,and direct spending.

The U.S.Treasury is primarily responsible for:

A primary focus of the Economic Stabilization Act of 2008,which became know as the ___________________________,was to allow the U.S.Treasury purchase up to $700 billion of troubled or toxic assets held by financial institutions.

Bank reserves are increased when the Treasury: