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Subject - Economics:

Macroeconomics

MCQ - 81-4091

Question:

If the Federal Reserve was concerned about the “crowding-out” effect, they could engage in

  1. expansionary monetary policy by lowering the discount rate.
  2. expansionary monetary policy by selling Treasury securities.
  3. contractionary monetary policy by raising the discount rate.
  4. expansionary monetary policy by selling Treasury securities.
  5. expansionary monetary policy by raising the reserve ratio.

Correct Answer: A

Explanation:

To avoid crowding out, the Fed should increase the money supply, and a lower discount rate does that.

Record Performance

269 MCQ for effective preparation of the test of Macroeconomics of Economics section.

Read the MCQ statement: If the Federal Reserve was concerned about the “crowding-out” effect, they could engage in , keenly and apply the method you have learn through the video lessons for Macroeconomics to give the answer. Record your answer and check its correct answer and video explanation for MCQ No. 81-4091.

How to Answer

Solve the question for MCQ No. and decide which option (A through D/E) is the best choice to answer the MCQ, then click/tap the blue button to view the correct answer and it explanation.

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