The Federal Reserve System performs many functions but its most important one is:

When using rational expectations, forecast errors will, on average, be ________ and ________ be predicted ahead of time

A) positive; can B) positive; cannot C) negative; can D) zero; cannot

If a bank keeps some of its excess reserves, the actual money multiplier

a. increases b. stays the same c. goes to zero d. decreases e. increases, then decreases