Question

When a bank repays a loan at the discount window to the Federal Reserve, it will...

When a bank repays a loan at the discount window to the Federal Reserve, it will __________ the monetary base by __________ bank reserves. Select one: a. decrease; decreasing b. increase; decreasing c. decrease; increasing d. increase; increasing

The securities that the Federal Reserve holds on its balance sheet include

Select one:

a.

?US Treasury securities, federal agency debt, and privately issued mortgage-backed securities.

b.

?privately issued stocks, US Treasury securities, and federal agency debt.

c.

municipal bonds, privately issued stocks, and US Treasury securities.?

d.

?US Treasury securities, municipal bonds, and federal agency debt.

If the loanable fun           ds? market is in equilibrium, and when conducting monetary policy, the Federal Reserve engages in the selling of US Treasury securities on the open market, there will be

Select one:

a.

?

?an increased demand for loanable funds , causing the equilibrium interest rate to decrease.

b.

?a decreased demand for loanable funds, causing the equilibrium interest rate to decrease.

c.

?

both a demand for loanable funds and supply of loanable funds, keeping the equilibrium interest rate unchanged.

d.

?

?a decrease to the supply of loanable funds, causing the equilibrium interest rate to rise.

Question 17

?The Federal Reserve notices a temporary increase in the public's desire to hold cash and fears that it may cause an increase in interest rates. To keep interest rates steady, the Federal Reserve would likely execute a transaction

Select one:

a.

? to provide a short-term reduction in the money supply.

b.

? to provide a long-term reduction in the money supply.

c.

? to provide a short-term boost to the money supply.

d.

? to provide a permanent increase in the money supply.

Homework Answers

Answer #1

When a bank repays a loan at the discount window to the Federal Reserve, it will decrease the monetary base by decreasing bank reserves

Hence a is correct option

The securities that the Federal Reserve holds on its balance sheet include

Correct option:

a) ?US Treasury securities, federal agency debt, and privately issued mortgage-backed securities.

b,c and d are wrong because private equity is not held

If the loanable fun           ds? market is in equilibrium, and when conducting monetary policy, the Federal Reserve engages in the selling of US Treasury securities on the open market, there will be

Select one:

Correct option: a. ?an increased demand for loanable funds , causing the equilibrium interest rate to decrease.

17)
c is the correct option

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