This quiz works best with JavaScript enabled. Home > Monetary > Policy > Monetary Policy – Quiz 10 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Monetary Policy Quiz 10 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Monetary Policy is the Bank of Englands attempt to ..... A) Control the amount of money in circulation. B) Control the UK Government's debt. C) Control governments' spending. D) Control the taxation rate. Show Answer Correct Answer: A) Control the amount of money in circulation. 2. Which of the following is not a tool of Monetary policy? A) Reserve requirement. B) Corporate tax rate. C) Discount rate. D) Open market operations. Show Answer Correct Answer: B) Corporate tax rate. 3. Monetary policy resulting in higher interest rates and restricted access to credit; associated with a contraction of the money supply. A) Easy money policy. B) Tight money policy. C) Open market policy. D) Interest rate policy. Show Answer Correct Answer: B) Tight money policy. 4. Who is the current Governor of the Bank of England A) Rishi Sunak. B) Mark Carney. C) Andrew Bailey. D) Dominic Raab. Show Answer Correct Answer: C) Andrew Bailey. 5. What are the actions taken to manage the availability and cost of money and credit to attain stable prices? A) Contractionary Policy. B) Monetary Policy. C) Fiscal Policy. D) Expansionary Policy. Show Answer Correct Answer: B) Monetary Policy. 6. A tool of monetary policy. The interest rate that the Federal Reserve charges financial institutions for loans. A) Discount Rate. B) Required Reserves. C) Interest on Reserves. D) Open Market Operations. Show Answer Correct Answer: A) Discount Rate. 7. What are two main tools the federal government has? A) Government spending and reserve requirement. B) Taxes and government spending. C) Buy/selling bonds and discount rate. D) Discount rate and taxes. Show Answer Correct Answer: B) Taxes and government spending. 8. Which does not cause a liquidity trap? A) Elastic demand for investment. B) Expectations of deflation. C) Preference for saving. D) Unwillingness to hold bonds. Show Answer Correct Answer: A) Elastic demand for investment. 9. How does fiscal & monetary policy differ? A) Fiscal=BudgetMonetary= Money. B) Fiscal= TaxesMonetary= Bonds. C) Fiscal= controlled by the government branchesMonetary= control by the FOMC. D) Fiscal= deals with revenues & expendituresMonetary= deals with money supply. Show Answer Correct Answer: A) Fiscal=BudgetMonetary= Money. 10. What is the primary goal of supply-side economic policies? A) To punish the wealthy. B) To stimulate consumption. C) To slow the multiplier effect. D) To stimulate production. Show Answer Correct Answer: D) To stimulate production. 11. One characteristic of money is that it is a store of value. Which of the following items is the greatest at storing value? A) Apple. B) Computer. C) Car. D) Gold. Show Answer Correct Answer: D) Gold. 12. If the Fed needs to follow contractionary monetary policy, what will happen to interest rates? A) They will increase. B) They will decrease. C) They will not change. D) None of above. Show Answer Correct Answer: A) They will increase. 13. What is NOT a function of money? A) Medium of exchange. B) Unit of account. C) Stores value. D) Meeting all 6 characteristics. Show Answer Correct Answer: D) Meeting all 6 characteristics. 14. Which of the following is one way the Federal Reserve Bank serves the government? A) Making loans to the Federal government. B) Maintaining the US Treasury's checking account. C) Minting coins for the government. D) Financing state government projects. Show Answer Correct Answer: B) Maintaining the US Treasury's checking account. 15. Ideally, the Fed's target for unemployment is ..... A) 2%. B) 0%. C) 5%. D) 10%. Show Answer Correct Answer: C) 5%. 16. This is a bank belonging to the Federal Reserve System. A) Member bank. B) Federal bank. C) State bank. D) Both a federal and state bank. Show Answer Correct Answer: A) Member bank. 17. What is the total value of goods and services produced each year, for a country? A) FOMC. B) GDP. C) Monetary Policy. D) Fiscal Policy. Show Answer Correct Answer: B) GDP. 18. Expansionary monetary policy in the United States causes U.S. interest rates ..... to and the dollar to ..... A) Decrease; depreciate. B) Decrease; appreciate. C) Increase; appreciate. D) None of above. Show Answer Correct Answer: A) Decrease; depreciate. 19. Which is NOT a committee at the Bank of England? A) Budget Committee (BC). B) Monetary Policy Committee (MPC). C) Financial Policy Committee (FPC). D) None of above. Show Answer Correct Answer: A) Budget Committee (BC). 20. Unlike many politicians, the Fed A) Must respond to pressure from the public. B) Is concerned about short-term interest rates. C) Is concerned about the long-run health of the economy. D) None of above. Show Answer Correct Answer: C) Is concerned about the long-run health of the economy. ← PreviousNext →Related QuizzesMonetary QuizzesMonetary Policy Quiz 1Monetary Policy Quiz 2Monetary Policy Quiz 3Monetary Policy Quiz 4Monetary Policy Quiz 5Monetary Policy Quiz 6Monetary Policy Quiz 7Monetary Policy Quiz 8Monetary Policy Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books