ECONOMICS
FISCAL POLICY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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there were too many bank panics.
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the economy had too many boom and bust periods.
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it was a way to create more jobs in the economy.
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the banking system was very unstable.
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Detailed explanation-1: -A particularly severe panic in 1907 resulted in bank runs that wreaked havoc on the fragile banking system and ultimately led Congress in 1913 to write the Federal Reserve Act. The Federal Reserve System was initially created to address these banking panics.
Detailed explanation-2: -Answer and Explanation: The Fed does not provide banking services to consumers. It is tasked with oversight over the banking sector, regulating the money supply in the economy and implementing monetary policies.
Detailed explanation-3: -It is the Federal Reserve’s actions, as a central bank, to achieve three goals specified by Congress: maximum employment, stable prices, and moderate long-term interest rates in the United States (figure 3.1).
Detailed explanation-4: -The correct answer is option b) Advising Congress on fiscal policy.