QUESTION 6 Which of the following would tend to decrease the U.S. money supply?

ID: 1114947 • Letter: Q

Question

QUESTION 6 Which of the following would tend to decrease the U.S. money supply? O A- a sale of securities on the open market by the Fed O B. an inflow of gold into the United States. O Ca lowering of the discount rate. O Da lowering of the reserve requirement QUESTION 7 Which of the following qualifies as reserves for a bank? demand deposits with other commercial banks O u.S. Treasury Securities deposits at the Federal Reserve bank O none of the above QUESTION 8 Monetary policy is carried out by: O A The Federal Reserve O B the Internal Revenue Service O C Congress the Treasury Department QUESTION 9 By raising the required reserve ratio, the Fed instigates changes in banks' beha that will ultimately result in a decrease in the money supply. Oan increase in bank lending to the general public. O lower interest rates. O an increase in excess reserves of the banking system. QUESTION 10 If the Fed buys U.S. govemment securities, O A the interest rate will rise O B. bank reserves will decrease O Cthe money supply will eventually increase

Explanation / Answer

Answer.)

Q6.) A.) a sale of securities on the open market by the fed

The Federal Open Market Committee (FOMC) buys and sells government securities to set the money supply. if the FOMC wants to decrease the money supply, it will sell securities.

Q7.) Deposits at the federal reserve bank

Q8.) A.) The Federal Reserve

Monetary policy is carried out by the Federal Reserve.

Q9.) a decrease in money supply

Increasing the reserve requirement ratios reduces the volume of deposits that can be supported by a given level of reserves and, in the absence of other actions, reduces the money stock.

Q10.) C.) The money supply will eventually increase.

The Federal Open Market Committee (FOMC) buys and sells government securities to set the money supply. if the FOMC wants to increase the money supply, it will buy securities.

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QUESTION 6 Which of the following would tend to decrease the U.S. money supply?

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