What effects does a federal reserve have on the economy? Select the three correct answers.
Income distribution
Economic growth
Poverty rate
Individual income tax rates
Prices
Employment
The correct answers are:
1. Economic growth: The Federal Reserve has the power to influence economic growth by implementing monetary policies that can stimulate or constrain the economy.
2. Prices: The Federal Reserve's actions and decisions can impact the general price level and inflation through its control over interest rates and money supply.
3. Employment: The Federal Reserve plays a crucial role in promoting full employment by managing monetary conditions that can influence job creation and unemployment rates.