Multiple Choice
Banks will hold additional excess reserves when
A) loans to customers look safe and interest rates are high.
B) they anticipate a bank audit.
C) loans to customers look risky and interest rates are low.
D) the economy is booming and there is a large demand for loans.
Correct Answer:

Verified
Correct Answer:
Verified
Q175: If interest rates increase, what will happen
Q176: Technically, the Federal Reserve district banks are
Q177: Investment spending is sensitive to interest rates.
Q178: The money supply contracts when the Fed<br>A)replaces
Q179: As a knowledgeable investor in 2007, you
Q181: An increase in the reserve supply<br>A)will result
Q182: Open-market operations refer to the purchase and
Q183: When the Federal Reserve System was first
Q184: Suppose that all banks maintain a 100
Q185: The Federal Reserve System can be described