Title: QUIZ: Price Stability -- The Federal Reserve and You
Course: Kelly's Copy-Export Course > Section: Price Stability -- The Federal Reserve and You

Q: Inflation can be positive for individuals that borrow because the dollars they pay back are worth
- nothing.
- less than the dollars they borrowed.
- more than the dollars they borrowed.
- the same as the dollars they borrowed.
A: less than the dollars they borrowed.

Q: Price stability is essential to a ________________ economy because _____________ undermines confidence and blurs the economic signals used by businesses and individuals in economic decisionmaking.
- moving; leverage
- rising; disinflation
- growing; inflation
- stalling; no inflation
A: growing; inflation

Q: The Federal Reserve ____________interest rates during the 1970s and 1980s to ______________ inflation and bring about price stability, ultimately seeking to strengthen the economy and improve employment.
- raised; raise
- raised; lower
- lowered; raise
- lowered; lower
A: raised; lower

Q: After its experiences in lowering inflation in the 1970s and 1980s, the Federal Reserve came to understand that
- inflation is uncontrollable and unpredictable.
- allowing deflation to occur can be healthy for the economy.
- there is no way to achieve low inflation and high employment.
- it is better to limit inflation early, rather than deal with it later.
A: it is better to limit inflation early, rather than deal with it later.