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AICPA Exam CPA-Business Topic 2 Question 79 Discussion

Actual exam question for AICPA's CPA-Business exam
Question #: 79
Topic #: 2
[All CPA-Business Questions]

To address the problem of a recession, the Federal Reserve Bank most likely would take which of the following actions?

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Suggested Answer: C

Choice 'c' is correct. Return on investment equals net income divided by average invested capital:

Choices 'a', 'b', and 'd' are incorrect, per the above calculation.


by Chantell at Dec 22, 2023, 12:59 AM

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Fernanda
2 days ago
B) Selling U.S. government bonds seems like the right move to me. That would reduce the money supply and help curb inflation.
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Marisha
2 days ago
That's a good point, selling bonds could also help stimulate the economy.
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Sylvie
4 days ago
I disagree, I believe they would sell U.S. government bonds in open-market transactions to address the recession.
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Marisha
9 days ago
I think the Federal Reserve Bank would lower the discount rate to help with a recession.
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Jaclyn
9 days ago
I think the answer is A) Lower the discount rate. The Federal Reserve typically lowers interest rates to stimulate the economy during a recession.
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