The largest liability item in the Federal Reserve Banks' consolidated balance sheet (as illustrated in the book, for April 2013) is:

The entrance of the U.S. into the Korean War in June of 1950 led to:

a. deflation. b. an increase in the unemployment rate. c. a long and deep recession. d. a surge in consumer demand. e. All of the above.

An institution that issues a currency at a fixed rate in exchange for an equivalent amount of another designated currency and invests the funds in bonds and liquid assets that provide 100 percent backing for the currency units issued is called

a. a central bank. b. the International Monetary Fund. c. the World Trade Organization. d. a currency board.