The demand for reserves curve in the federal funds market is Group of answer choices a. horizontal. b. vertical. c. upward sloping. d. downward sloping.

Establishing upper and lower limits for the federal funds rate enabled the Fed to A. buy financial assets to make ample reserves available. B. sell financial assets to limited the reserves available. C. buy financial assets to limited the reserves available. D. sell financial assets to make ample reserves available.

If the required reserve ratio is 25 percent and the Fed buys a S20,000 security from a depository institution that currently has no excess reserves, the maximum change in money supply in the economy is: - $20,000. $5,000. $20,000. $80,000. - $80,000.

If a bank has $2,000,000 in deposits with $200,000 in reserves, the reserve ratio for the banking system is   A. 10 percent.   B. 15 percent.   C. 20 percent.   D. 1 percent.

No written by hand solution

Which of the following is a valid statement?   a. Excess reserves = total reserves minus required reserves.   b. Required reserves = the minimum reserves required by the Fed.   c. Required reserve ratio = required reserves as a percentage to total deposits.   d. All of these.

If we see that the Federal Funds Rate equilibrium is equal to the Discount rate, which one of the following Fed actions would be most appropriate?   A.   Open Market Policy   B.   Change the IOR   C.   Quantitative Easing   D.   Change the Discount Rate