Exam 4: Functions of the Fed

As the supply of funds in the banking system ____, the federal funds rate ____.

The ____ is made up of seven individual members, and each member is appointed by the president of the United States.

Most of the Fed's income is transferred to the U.S. Department of Justice.

All commercial banks are required to be members of the Fed.

The advisory committee offering views on issues related to credit unions is the

Credit may be used for any purpose and is available only to depository institutions that meet specific requirements for financial soundness.

The the reserve requirement ratio, the the ultimate effect of any initial increase in the money supply.

____ open market operations offset the impact of other conditions that affect the level of funds.

To decrease the money supply, the Fed could the reserve requirement ratio.

When open market operations are used to ____ bank funds, the yield on debt instruments ____.

The effects of the credit crisis in 2008 were largely confined to the United States, so central banks in other nations did not have to reduce their targeted interest rate levels.

Since 2003, the Fed's rate on short-term loans to depository institutions is referred to as the

Assume that the reserve requirement ratio is 12 percent and that the Fed uses open market operations to buy $200 million worth of Treasury securities. Assuming that banks use all funds exceptrequired reserves to make loans and that the public does not store any cash, the money supply should ____ by about ____.

When the Fed sells securities, the total funds of commercial banks ____ by the market value of the securities sold by the Fed. This activity initiated by the FOMC's policy directive is referredto as a ____ of money supply growth.

The purchase of government securities by someone other than the Fed results in

Repurchase agreements are purchased by the Fed to

When the Trading Desk sells a sufficient amount of Treasury securities, it creates a surplus of funds in the banking system. Consequently, the federal funds rate decreases along with other interest rates.

Which of the following is an action that the Fed uses to increase or decrease the money supply?

The Board of Governors is composed of

If the Fed initiates a program to purchase long-term Treasury securities, it is most likely attempting to: