FOMC/BOG
What is the Open Market Committee responsible for?
Open Market Operations
Jerome H. Powell
Do classical and Keynesian economists have the same opinion towards the Federal reserve?
No
What is the discount rate used for primarily?
Why was the Federal Reserve created?
To provide the united states with a safer and more stable economy using monetary policy and to promote economic goals
What are the board of governors responsible for?
Discount rate and Reserve requirements
How often does the president of the new york federal reserve bank change?
Every 5 years
How would a Classical Economist feel about the Federal Reserve?
They would strongly disapprove of the federal reserve
What FOMC tool is buying/selling government securities to affect money supply?
Open Market Operations
Why did the Fed employ various monetary policy tools?
To control unemployment rates and maintain prices.
Who is a permanent member of the FOMC?
President of the New York Federal Reserve Bank
True or False, the FOMC has alternate members for the Federal reserve bank rotation?
True
How would a Keynesian Economist feel about the Federal Reserve?
A Keynesian economist would view it as crucial for the economy
Increasing this tool helps fight inflation
How many basis points has the Fed’s policy interest rates been lowered by?
25
How many meetings does the committee regularly hold?
8
Who is the current Vice Chairman of the FOMC
John C. Williams
Why did Keynesian economists like the idea?
because the federal reserve uses its powers to influence interest rates and the money supply to manage economic downturns and booms effectively
True or false lowering the federal funds rate eases credit conditions?
True
How did the federal reserve contribute to the 2008 financial crisis?
The Fed created an environment in the economy with low interest rates that promoted excessive borrowing and risk taking
Which of the Federal Reserve bank "groups" only have 2 cities?
Group 2 (Cleveland and Chicago)
How are the members of the board of governors selected/appointed?
the members of the board of governors are selected by the president which are then confirmed by the senate for 14 year terms. The Chair and Vice Chair are also appointed the same way from among the governors for 4 year terms.
Why did Classical economists dislike the idea?
because it represents government intervention in a self-correcting market arguing against the roles in money management supply.
Adjusting what tool impacts how much money banks have available to lend?
Reserve Requirements
How did the federal reserve contribute to the cause of the great depression?
Poor use of the financial tools such as tightening their monetary policy when it should have been eased