Exam 24: The Aggregate Demandaggregate Supply Model

Table 9-6: Deposit Expansion Stages In Table 9-6, assume that banks loan out 100% of their excess banking reserves, there are no cash withdrawals, and all loan proceeds are spent. Figures have been rounded up to the nearest whole number. -Refer to Table 9-6. What is the value of $D in Stage 4 (round up to the nearest whole number)?

Which of the following is an example of a bank's reserves?

The Fed can increase the federal funds rate by

A financial institution that accepts deposits, makes loans, and offers checking accounts is

An institution that collects funds from lenders and distributes these funds to borrowers is called

Money is any item that is widely used and freely accepted as payment for goods and services.

A primary function of a central bank is to

Which of the following is an example of a bank's liabilities?

Which of the following equations is correct?

Table 9-1 -Refer to Table 9-1. The money supply measured by M2 is

When the Fed _______ governments bonds it _______ bank reserves.

Keeping a $20 bill in your purse to purchase a movie DVD when it comes out next month means that money functions as a

Money that some authority, generally a government, has ordered to be accepted as a medium of exchange is called _______ money.

The Federal Reserve System was established in 1913 in response to the

Which of the following illustrates the store-of-value function of money?

The Fed conducts an open market purchase of $10 million in government securities. If the reserve ratio is 20%, what is the maximum change in the money supply? Assume banks hold no excess reserves and there is no currency withdrawal from the banking system.

In the banking system today, the reserves banks hold against their deposit liabilities must take one of two forms. They are

Table 9-6: Deposit Expansion Stages In Table 9-6, assume that banks loan out 100% of their excess banking reserves, there are no cash withdrawals, and all loan proceeds are spent. Figures have been rounded up to the nearest whole number. -Refer to Table 9-6. What is the value of $A in stage 1?

If the banking system has $2,000 in excess reserves, then it can expand deposits at most by $10,000 if the required reserve ratio is 10%.

The discount rate