Type of defensive open market operations will the manager undertake if it is difficult for him to present checks for payment and so raising the float if he hears that a snowstorm is about to strike the city. Concept Introduction: Open market operations: It is a financial operation which includes buying and selling of securities in the open market. Float: When Fed clears checks for the banks (from one bank to another), then the bank in which the amount is credited experiences a temporary increase in the total reserves in the banking system (and hence the monetary base) occurring from Fed’s check clearing process is called float.

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Answer 1

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Definition Definition Capital reserves held by banks or financial institutions over and above the reserves that are required to be maintained by the regulator toward its liabilities and for internal controls. For commercial banks, excess reserve is the amount over the standard reserve as decided by the central bank. These excess reserve funds are available in the form of cash and cash equivalents.

Chapter 18, Problem 1Q

To determine

Type of defensive open market operations will the manager undertake if it is difficult for him to present checks for payment and so raising the float if he hears that a snowstorm is about to strike the city.

Concept Introduction:

Open market operations: It is a financial operation which includes buying and selling of securities in the open market.

Float: When Fed clears checks for the banks (from one bank to another), then the bank in which the amount is credited experiences a temporary increase in the total reserves in the banking system (and hence the monetary base) occurring from Fed’s check clearing process is called float.

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Answer 2

Question

Definition Definition Capital reserves held by banks or financial institutions over and above the reserves that are required to be maintained by the regulator toward its liabilities and for internal controls. For commercial banks, excess reserve is the amount over the standard reserve as decided by the central bank. These excess reserve funds are available in the form of cash and cash equivalents.

Chapter 18, Problem 1Q

To determine

Type of defensive open market operations will the manager undertake if it is difficult for him to present checks for payment and so raising the float if he hears that a snowstorm is about to strike the city.

Concept Introduction:

Open market operations: It is a financial operation which includes buying and selling of securities in the open market.

Float: When Fed clears checks for the banks (from one bank to another), then the bank in which the amount is credited experiences a temporary increase in the total reserves in the banking system (and hence the monetary base) occurring from Fed’s check clearing process is called float.

Expert Solution & Answer

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Answer 3

Question

Definition Definition Capital reserves held by banks or financial institutions over and above the reserves that are required to be maintained by the regulator toward its liabilities and for internal controls. For commercial banks, excess reserve is the amount over the standard reserve as decided by the central bank. These excess reserve funds are available in the form of cash and cash equivalents.

Chapter 18, Problem 1Q

To determine

Type of defensive open market operations will the manager undertake if it is difficult for him to present checks for payment and so raising the float if he hears that a snowstorm is about to strike the city.

Concept Introduction:

Open market operations: It is a financial operation which includes buying and selling of securities in the open market.

Float: When Fed clears checks for the banks (from one bank to another), then the bank in which the amount is credited experiences a temporary increase in the total reserves in the banking system (and hence the monetary base) occurring from Fed’s check clearing process is called float.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 4

Question

Definition Definition Capital reserves held by banks or financial institutions over and above the reserves that are required to be maintained by the regulator toward its liabilities and for internal controls. For commercial banks, excess reserve is the amount over the standard reserve as decided by the central bank. These excess reserve funds are available in the form of cash and cash equivalents.

Chapter 18, Problem 1Q

To determine