FED FED
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MonetarMonetaryy
Policy Policy
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Fiscal Fiscal
Policy Policy
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VocaVocab. b.
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??
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End Game Double Jeopardy
101000
Check Answer
What is the full name of the FED
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Federal Reserve System
202000
Check Answer
What are the 12 banks that carry out the FED’s policies?
202000
Federal Reserve Banks
Check Answer300300
Who sets the Fed’s policy on the purchase and sale of gov't securities?
Check Answer400400
What group of people run the FED?
400400
Board Of Governors
Check Answer500500
Who is the Chairman of the Board of Governors?
500500
Ben Bernanke
Check Answer1010
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FED’s decisions that affect the money supply is called….
101000
Monetary policy
Check Answer2020
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The buying and selling of government securities
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Open-Market Operations
Check Answer300300
When the FED wants to make loans more attractive
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Loose Money/ Expansionary Monetary Policy
Check Answer4040
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When the FED wants to discourage banks from
loaning out too much money
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Tight Money/ Contractionary Monetary Policy
Check Answer500500
What are the THREE tools of the FED?
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1.Discount Rate2.Reserve Requirement
3.Open Market Operations
Check Answer1010
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What are the two major tools of fiscal policy?
101000
1.Taxes
2.Government Spending
Check Answer2020
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What fiscal policy would not help solve the unemployment
problem?
202000
Higher taxes
Check Answer300300
What should the fiscal policy be during a (1) recession and (2) inflation using the Keynesian
philosophy?
300300
1.Reduce taxes, increase government spending
2.Increase taxes, decrease government spending
Check Answer4040
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When will discretionary fiscal policy most stabilize the economy?
404000
Deficits occur during recessions and surpluses occur during
inflation
Check Answer500500
What is automatic stabilizers?Give an example.
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Money that changes hands from taxpayer to non-taxpayer; social
security payments, unemployment compensation,
US income tax system
Check Answer1010
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Informal name for the Federal Reserve System
Check Answer2020
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Interest that banks charge each other for loans
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Federal funds rate
Check Answer300300
Interest the FED charges banks for loans
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Discount rate
Check Answer4040
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The interest rate banks charge their best customers
404000
Prime Rate
Check Answer500500
What are the 4 functions of the FED?
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1.Check clearing2.Distribute paper currency
3.Bank for banks4.Bank for government
Check Answer1010
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How do the members of the Board of governors get
their jobs?
101000
Appointed by President and confirmed by Senate
Check Answer2020
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What is the FED trying to do to the nations money supply if it increases the discount rate?
202000
Decrease money supply
Check Answer300300
What happens to the reserves of member banks when they borrow from the FED?
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Reserves Increase
Check Answer4040
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When the FED practices an expansionary Monetary policy, what happens on the open market?
404000
FED Buys Securities
Check Answer500500
What are the 4 functions of the FED?
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1. Clears checks2. Bank for Banks3. Bank for Govt4. Distribute Paper Currency
More More Fiscal Fiscal
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BudgetsBudgets
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End Game Final Jeopardy
More More MISCMISC
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MoreMore FED FED Misc.
200200 Check Answer
What should the Govt do to decrease unemployment?
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Increase spending
404000
Check Answer
When the Govt practices expansionary Fiscal Policy, what
happens to taxes?
404000
Decrease Taxes
600600 Check Answer
What is supply side Economics?
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Govt provides incentives for producers to increase aggregate demand.
800800 Check Answer
If GDP decreases and unemployment rises in 2 quarters, what would the
appropriate fiscal policy be?
800800
Decrease taxes & increase spending
10010000
Check Answer
When might demand-side Fiscal policy prove politically unpopular?
10010000
When the gov't attempts to raise taxes during an
expansion & lower Taxes during a contraction
200200 Check Answer
Who confirms the FED’s board of governors?
404000
Check Answer
Who appoints the FED board of governors?
600600 Check Answer
Who approves the Fed decisions?
800800 Check Answer
To increase the money supply, how does the FED
utilized the 3 tools?
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1. Lower DR
2. Lower RR
3. Buy Securities
10010000
Check Answer
What type of Monetary policy is used when the Fed buys securities?
10010000
Expansionary Monetary Policy
200200 Check Answer
What is a deficit budget?
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Spending > Revenue
404000
Check Answer
What is a surplus budget?
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Revenue > Spending
600600 Check Answer
What is a balanced budget?
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Spending = Revenues
800800 Check Answer
What type of budget have we had since 2001?
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Deficit Budget
10010000
Check Answer
1.What is the gov't main source of revenue?
2.Give an example of Govt spending?
10010000
2.Defense, education, infrastructure, social programs
1.Taxes
200200 Check Answer
Who primarily conducts fiscal policy?
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President/Congress
404000
Check Answer
If GDP decreases and Unemployment rises in 2
quarters, what would be the appropriate Monetary policy?
404000
Decrease RR and decrease DR, Buy
Securities
600600 Check Answer
What phase of the business cycle are we currently in?
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Contraction/Trough
800800 Check Answer
Give an example of Fiscal and monetary policies counteracting each other?
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Increase gov't spending & sell securities
Answers may vary
10010000
Check Answer
Receiving an unemployment check is an example of________ fiscal policy and is a ________ stabilizer.
10010000
Expansionary,
Automatic
200200 Check Answer
Government cuts personal income tax rates is an example of ________ fiscal policy & __________ spending .
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Expansionary & Discretionary
404000
Check Answer
Government raises Income taxes this is an example of _________ fiscal policy.
404000
Contractionary
600600 Check Answer
Transfer payments such as social security and welfare are an example of ________
_______.
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Automatic Stabilizers.
800800 Check Answer
What fiscal policy would not help solve the unemployment problem?
800800
Higher Taxes
10010000
Check Answer
List 4 examples of Automatic Stabilizers
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Unemployment, Social Security, US Income Tax System, Medicaid/Medicare
(Answers may vary)
AA
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BB
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CC
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DD
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End Game Final Jeopardy
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Final Final JeopardyJeopardy
Check Answer
Given the current economic conditions, what would be the
appropriate monetary and fiscal policies?
What are limits to these policies?
Final Final JeopardyJeopardy
1. Monetary= Lower RR, Lower DR, Buy Securities
Fiscal = Tax cuts & increase spending
2. FED can’t force banks to loan money
Gov’t can’t force people to spend the money they give them (tax cuts)