Exam 20: Understanding Movements in Bank Reserves

Factors supplying and absorbing bank reserves constitute the

If the Treasury finances an expenditure by borrowing from banks with excess reserves, the money supply will

The monetary base will increase if

Which of the following appears as a liability on the Federal Reserves balance sheet?

Bank reserves increase when the Treasury finances an expenditure through

Suppose that the Treasury decides to spend $12 billion on a given day. Because about $12 billion in new tax revenues are expected to replenish the Treasury's account at the Fed a week later, the best policy for the Fed to pursue if it wishes to stabilize reserves is to

Federal Reserve liabilities are equal to

If the Treasury prints currency to finance an expenditure, the impact on the money supply is similar to when the Treasury borrows from the

Assume a money multiplier of 4 and a government expenditure of $20 million. If the Treasury borrows $20 million from the banking system while the banks have excess reserves, the money supply will

When currency outstanding increases,

The importance of the float is that it

When the Treasury borrows from the non-bank public and makes an expenditure of an equal amount, the money supply

Federal Reserve liabilities and capital accounts are equal to

The Federal Reserve float is

Assume the federal government collects $20 billion in taxes and spends them on the public. If the money multiplier is 2.5, bank reserves

Assume a money multiplier of 2. If the Treasury finances a $10 million expenditure by selling securities to the Fed, bank reserves will

Which of the following appears as an asset on the Federal Reserves balance sheet?