Wise Practice Test Questions With Revised Correct Answers Updated & Passed

Wise Practice Test Questions With Revised Correct Answers Updated & Passed Which of the following does the Federal Reserve use to regulate the nation's money supply? - ANSWER : C: Monetary policy reasons:The Federal Reserve uses monetary policy to regulate the nation's money supply. Monetary policy is directed at expanding or contracting the supply of money and credit in the U.S. economy. In theory, if there is too little money in circulation, consumers will spend less, interest rates will be high, and unemployment will rise. In this situation, the Fed can deliberately increase the amount of money in circulation, leading to lower interest rates, increases in consumer spending, and higher employment rates. If there is too much money in circulation, however, prices rise and the value of the dollar decreases (inflation) New coins and currency make their way into the general economy, consumers and businesses, through the distribution system of the: - ANSWER : C: Federal Reserve System reasons:The U.S. Federal Mint , which is an operating bureau of the Department of the Treasury, makes new coins. The U.S. Bureau of Engraving and Printing prints new currency. The coins and currency are sent to the Federal Reserve Banks, which distribute it as needed. Most new coins and currency replace damaged or worn out coins and currency being taken out of circulation. The common name for U.S. currency is: - ANSWER : C: Green backs reasons:The background color of all United States currency (bills) is primarily green.