Feds System Tools and Monetary Policy Quick Check

Question

5 of 55 of 5 Items
Question
Which policy affects the prices of assets, and short-term and long-term interest rates?(1 point)
Responses

monetary policy
monetary policy

tax policy
tax policy

fiscal policy
fiscal policy

reserve requirements

Answer 1

The correct response is monetary policy. Monetary policy is designed to manage the economy by influencing the supply of money and interest rates, which in turn affects asset prices and both short-term and long-term interest rates.