ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Question
Which of the following instruments is NOT used by the Federal Reserve to change the money supply?
Group of answer choices
the federal tax code
open market operations
the required reserve ratio
the discount rate
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- Which of the following monetary tools is the Fed most likely to use for carrying out its day-to-day management of the money supply? Changes in the discount rate Changes in the reserve requirement Changes in tax rates Open market operationsarrow_forwardWhat do Federal Reserve economists use the Federal Reserve Board's model of the U.S. economy for? It is used only for forecasting. It is used for forecasting and policy analysis. It is used only to describe the economy. It is used only for policy analysis.arrow_forwardThe following are entities within the Federal Reserve System, EXCEPT: Treasury Department Federal Reserve Banks Board of Governors Federal Open Market Committee The following are some of the key functions of the Federal Reserve System, EXCEPT: Implement monetary policyarrow_forward
- The Federal Reserve is a- is an institurion that oversees the safety and stability of the US banking system b- Central Bank c- quantitative easing d- discount ratearrow_forwardThe Federal Open Market Committee (FOMC) is one branch of Federal Reserve System responsible for: Group of answer choices Approving discount rate Setting Federal Funds Rate Target Range Recommending Discount ratearrow_forwardDiscuss the structure and organization of the U.S. Federal Reservearrow_forward
- Suppose the reserve ratio is 20% for all banks. If the Fed increases bank reserves by $200, then the money supply will:arrow_forward28) If the required reserve ratio is 10% and the Federal Reserve purchases $50 million in treasury bonds on the open market, how could the money supply be impacted? a) Increase by a maximum amount of $500 million b) Increase by a maximum amount of $50 million c) Decrease by a maximum amount of $500 million d) Decrease by a maximum amount of $50 million 29) What is the most likely outcome of expansionary monetary policy? a) A decrease in the quantity of money, higher interest rates, and increased aggregate demand. b) An increase in the quantity of money, higher interest rates, and increased aggregate demand. c) A decrease in the quantity of money, lower interest rates, and decreased aggregate demand.. d) An increase in the quantity of money, lower interest rates, and increased aggregate demand.arrow_forwardWhich of the following would be classified in the M1 category of the money supply? demand deposits certificates of deposit savings deposits money market depositarrow_forward
- Describe the functions of the federal reserve system. What is its number one function from a policy point of view?arrow_forwardIf the Fed wants to increase the money supply, it can decrease the federal funds rate. decrease the tax rate. sell bonds in the open market. increase the reserve requirement.arrow_forwardDiscuss in detail how the Fed utilizes tools that can be used to control the money supply. Feds tools: Reserve requirements Discount rate Open market operationsarrow_forward
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