During most of the 1990s and 2000s, the trend in interest rates was:

Moral hazard is illustrated by people who take greater risks after they purchase insurance

a. True b. False Indicate whether the statement is true or false

Answer the following statements true (T) or false (F)

1. The primary function of the Fed’s Board of Governors is to formulate U.S. monetary policy. 2. The first attempt at centralized banking in the United States was the Federal Reserve System. 3. A major weakness of the National Banking System was the perverse elasticity of the money supply. 4. The Federal Reserve System was established by the National Banking Act of 1864. 5. Instead of having one central bank, the Federal Reserve in effect has twelve district banks, each with some amount of autonomy.