Exam 11: The Monetary System

If the Fed buys a $100,000 government security from a bank when the desired reserve ratio is 10 percent and the currency drain is 50 percent, the bank can loan a maximum of

If you deposit $1,000 in cash in your checkable deposit at your bank, the quantity of M1 immediately

Which of the following Federal Reserve banks carries out the decisions of the FOMC?

A bank has checkable deposits of $1,000,000, loans of $600,000, and government securities of $400,000.If the required reserve ratio is 5 percent, the amount of required reserves is

Does the Federal Reserve conduct both the nation's monetary policy and its fiscal policy?

Cisco is considering opening a financial institution that accepts savings deposits from only its employees and makes loans to only its employees.The best description of this financial institution is that it is a

The number by which a change in the monetary base is multiplied to find the resulting change in the quantity of money is called the

The Federal Reserve reports that it has coins valued at $10 billion, bank reserves at the Fed of $15 billion, gold valued at $10 billion, Federal Reserves notes of $400 billion, and U.S.government securities of $300 billion.What is the size of the monetary base?

The Board of Governors of the Federal Reserve System has

The Citizens First Bank sells $100,000 of government securities to the Fed.This sale immediately

An open market purchase of securities by the Fed leads to all of the following EXCEPT

The minimum percent of deposits that banks must hold and cannot loan is determined by the

When the Fed buys securities from the public, banks' reserves ________ and the quantity of money ________.

A bank has deposits of $400, reserves of $50, and the desired reserve ratio is 7 percent.The bank's excess reserves are

Which of the following are assets of commercial banks? i. reserves. ii. loans. iii. deposits.

In December 2009, currency outside of banks was $400 billion, traveler's checks were $5 billion; checkable deposits owned by individuals and businesses were $600 billion, saving deposits were $2,000 billion, time deposits were $1,500 billion; and money market funds were $1,200 billion.What was the M2 in December 2009?

An increase in the currency drain

Which statement about money is most correct?

The four main policy tools the Federal Reserve System uses to influence the interest rate are setting

If currency outside of banks is $800 billion; traveler's checks are $10 billion; checkable deposits owned by individuals and businesses are $700 billion; savings deposits are $4,000 billion; small time deposits are $1,000 billion; and money market funds and other deposits are $800 billion, then M2 equals ________ billion.