Suppose the Federal Reserve wants to stimulate the economy, thereby increasing GDP. Which of the following policy change should be implemented?       Raising the reserve requirement ratio       Sell bonds through open market operations       Lower the discount rate       Only a & c are correct

Q: 48. The Federal Reserve Bank "controls" the Office of Terrorism & Financial Intelligence. The…

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A: Correct option is (b)  the stock market crash that began the great depression.

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Q: 1) Describe the Federal Reserve and its role

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Q: 7. The required reserve ratio helps determine the amount of money banks can create.

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Required Reserve and Excess Reserve Analysis

A required reserve is an amount of cash that banks must keep with themselves, which is certain percentage of the deposits made by their customers. Required reserve is a percentage of the bank's deposits that the respective bank must have on each overnight. The percentage rate is set and determined by the nation’s central bank. It is important to have such funds accumulated to meet its uncertain obligations, sudden liabilities and withdrawals. Required reserve is also known as reserve ratio. Reserve ratio is an important tool to control the money supply.