Question

Which of the following techniques are employed by the Federal Reserve

Board to influence the overall performance of the national economy?
1. Raising or lowering the discount rate
II. Increasing or decreasing the reserve requirement
III. Buying and selling Treasury securities
IV. Raising or lowering excise taxes
OA. I and IV only
OB. II and III only
OC. I, III, and IV only
OD. II, III, and IV only
E III and III only.

Answer 1

The Federal Reserve Board employs several techniques to influence the overall performance of the national economy, including raising or lowering the discount rate, increasing or decreasing the reserve requirement, and buying and selling Treasury securities.

Step-by-step explanation:

The Federal Reserve Board employs several techniques to influence the overall performance of the national economy. These techniques include:

1. Raising or lowering the discount rate: The discount rate is the interest rate at which commercial banks can borrow from the Federal Reserve. By adjusting this rate, the Fed can encourage or discourage borrowing and spending.
2. Increasing or decreasing the reserve requirement: The reserve requirement refers to the amount of funds that banks must hold in reserve. By changing this requirement, the Fed can control the amount of money available for lending.
3. Buying and selling Treasury securities: The Fed can influence the money supply by buying or selling government securities. When the Fed buys these securities, it injects money into the economy; when it sells them, it removes money from circulation.

The techniques mentioned in options I, II, and III are all employed by the Federal Reserve Board to influence the overall performance of the national economy. Therefore, the correct answer choice is option C. I, III, and IV only.

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