A hypothetical currency (a) of country A grows stronger against the £ due to an increased supply of £s, moving from 120a/1£ to 105a/1£. Country A's central bank conducts a non-sterilised intervention by selling currency a, and buying £s. Draw a diagram for supply and demand for pounds in the forex market, and illustrate and comment on the intervention taken by Country A's central bank. Drawing a separate diagram, show the impact of this intervention on currency a's overall money supply and demand conditions.

9. Changes in the demand for money and and monetary policy Suppose interest rates increased. Adjust the following graph to illustrate the described change. INTEREST RATE Money Supply QUANTITY OF MONEY MD₂ As a result of an increase in interest rates, the equilibrium interest rate does not change. The level of foreign direct investment Central banks' holdings of the currency Foreign demand for a country's goods The discount rate MD₁ Money Demand Money Supply rises Which of the following factors may also be responsible for a shift in the money demand curve? Check all that apply. and the equilibrium quantity of money

Figure 369-169 VALUE OF MONEY 5 2 MS. D B MS. A C Money Demand QUANTITY OF MONEY Refer to Figure 369-169. If the money supply is MS₂ and the value of money is 5, then the quantity of money demanded is greater than the quantity supplied; the price level will rise. demanded is greater than the quantity supplied; the price level will fall. supplied is greater than the quantity demanded; the price level will rise. supplied is greater than the quantity demanded; the price level will fall.

Assume that the Fed follows an unhinged intervention by selling $500 billion worth of GBP against USD in the foreign exchange market. By using the supply and demand diagram of USD show the results of this policy on the price of USD expressed in GPB (GBP/USD).

Match the moneys source of value with the example

You have been given the banking and financial data in the following table. Your boss wants you to calculate the M1 money supply (using the U.S. laws and regulations) but forgets to tell you which year the data pertain to. You call your boss and she tells you that the data is for 2021. In that case, you calculate the following for your boss: Currency in Circulation $100 Demand Deposits $1,000 Savings Deposits $4,400 Small Time Deposits (Less than $100,000) $2,000 Large Time Deposits (Greater than $100,000) $4,000 Money Market Mutual Funds Deposits Owned by Individuals $1,000 Money Market Mutual Funds Deposits Owned by Institutions $5,000 Total Reserves in the Banking System $2,100 O a. M1 = $1,000 O b. M1 = $1,100 O c. M1 $2,200 = O d. M1 $4,300 O e. M1 $5,500

Mcq  question  give fast answer Transactions demand for currency reflects which of the following?: Mark all that apply   Demand to hold currency that will not be spent for the period in question   Demand for currency that will to be spent during the period in question   overall demand for currency   demand to hold currency on deposit at a bank

You have been hired as a Marco Economist by the President of the United States to help evaluate the recentannouncement by Federal Reserve chairman Ben Bernanke that the FED will be increasing interest rates again.Ben Bernanke has justified the move on the grounds that the economy continues to be strong. Answer thefollowing questions. Provide a graphical explanation for your answers whenever possible. What is the effect on the foreign exchangemarket (the $ market)? 12. What impact will this have on imports?A. increaseB. decreaseC. remains unchanged 13. What impact does the change in the exchangerate have on aggregate demand?A. increase (shifts to the right)B. decrease (shifts to the left)C. remains unchanged 14. What happens to the aggregate supply curve?A. increase (shifts to the right)B. decrease (shifts to the left)C. remains unchanged

Consider an economy with the following information: Checking deposits $2000 Cash held by the public: $400 Savings deposits $1100 Calculate its M1 money supply, assuming this is the only relevant information.

Using the model of reserves, graphically show the impact of OMO sales and IORB rate cut