What are the main functions of a Central Bank? To reduce unemployment, promote financial stability, and provide banking services for depository institutions and the federal government To reduce unemployment, control inflation, and promote financial stability To decrease inflation, promote financial stability, and provide banking services for depository institutions and the federal government O To conduct monetary policy, promote financial stability, and provide banking services for depository institutions and the federal government
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- How is a central bank different from a typical commercial bank?Compare the structure and independence of theEuropean System of Central Banks and the FederalReserve SystemWhich of the following is NOT true about the FederalReserve?a. It was established by the U.S. Constitution.b. It regulates the banking system.c. It lends to banks.d. It conducts open-market operations.
- Explain the factors on which an independent central bank can havepositive impact and the factors on which it might create negativeimpact?Which of the following is NOT a function performed by a central bank? O a. Serving as a lender of last resort to commercial banks O b. Taking the deposits of commercial banks Making profits for its shareholders O d. Regulating the money supplyWhat is Domestic Systemically Important Bank (D-SIB) and Global Systemically Important Bank (G-SIB) ? How the mechanism of both ? Explained with comprehensive
- Consider an economy in which the money supply consists of both currency and deposits. The growth rate of the monetary base, the growth rate of the money supply, inflation, and expected inflation all are constant at 10% per year. Output and the real interest rate are constant. Monetary data for this economy as of January 1, 2016, are as follows: Currency held by nonbank public $200 Bank reserves $50 Monetary base $250 Deposits $600 Money supply $800 a. What is the nominal value of seignorage over the year? (Hint: How much monetary base is created during the year?) b. Suppose that deposits and bank reserves pay no interest, and that banks lend deposits not held as reserves at the market rate of interest. Who pays the inflation tax (measured in nominal terms), and how much do they pay? (Hint: The inflation tax paid by banks in this example is negative.) c. Suppose that deposits pay a market rate of interest. Who pays the inflation tax, and how much do they pay?FORUM DESCRIPTION IS CRYPTOCURRENCY MONEY, WILL IT INSTRUCTION: You are required to post an original comment and also respond to at least two other comments to agree/clarify/disagree BECOME MONEY, & WHAT MAY BE THE EFFECT OF CENTRAL BANK DIGITAL CURRENCY ON PRIVATE CRYPTOS? In your post, give us one reason, based on definition of money, for or against adopting cryptocurrency as money, exactly like the dollar. Also, given that we do not use cryptocurrency to pay for grocery in almost all countries and territories, give two key reasons why it has not been widely accepted as money. What is the effect of central bank cryptocurrency (like digital dollar or Yuan) on your previous answer?Attempts Keep the Highest / 3 5. The Federal Reserve's organization There are Federal Reserve regional banks. The Federal Reserve's role as a lender of last resort involves lending to which of the following financially troubled institutions? O U.S. state governments when they run short on tax revenues O U.S. banks that cannot borrow elsewhere O Governments in developing countries during currency crises The Federal Reserve's primary tool for changing the money supply is In order to decrease the number of dollars in the U.S. economy (the money supply), the Federal Reserve will M government bonds.
- What are the primary functions of a central bank? providing banking services to businesses and consumers conducting monetary policy ensuring the stability of the financial system conducting fiscal policy providing banking services to commercial banks, depository institutions, and the federal governmentWhat bank assets are liquid assets? What is the largest asset of commercial banks? A bank's liquid assets consist of A. its short-term Treasury bills and overnight loans to other banks B. currency in its vaults plus the balance on its reserve account at a Federal Reserve Bank O C. the money in its ATMS and the bonds that it owns, which are issued by the U.S. government and by other large, safe organizations D. the currency in its vaults and the money in checking and savings deposits The largest asset of commercial banks are O A. loans O B. deposits O C. reserves O D. securitiesAssuming an economy have only two commercial banks in it banking system, Classic Bank and Prudent Bank. The following shows the balance sheet of the two banks as at 2019. Classic Bank Balance sheet as at December, 2019 GHSm GHSm Assets: Liabilities & Equity: Reserves 1,000 Deposits 3,000 Securities 2,000 Equity 7,000 Loans & Advances 1,000 Property, Plant and Equipment 6,000 . 10,000 10,000 Prudent Bank Balance sheet as at December, 2019 GHSm GHSm Assets: Liabilities & Equity: Reserves 600 Deposits 2,500 Securities 1,500 Equity 4,400 Loans & Advances 800 Property, Plant and Equipment 4,000 . 6,900 6,900 Assume a required reserve ratio of 10%. What is the maximum amount that the money supply can be expanded? What would be the effect of a fall in reserve ratio to 5%, on the maximum amount that the money supply can be expanded?