19. The Federal Reserve System was established in 1913 in response to the A) First World War. B) bank panic of 1907. C) depression of 1883. D) prosperity of the 1920s. 20. Which organization is responsible for managing the nation's money supply? A) The Federal Reserve Bank of New York B) The United States Treasury C) The Federal Open Market Committee D) The American Association of Bankers 21. The Fed's most important and most frequently used tool of monetary policy is A) moral suasion. B) open-market operations. C) changes in the discount rate. D) changes in required reserve ratios.

19. The Federal Reserve System was established in 1913 in response to the A) First World War. B) bank panic of 1907. C) depression of 1883. D) prosperity of the 1920s. 20. Which organization is responsible for managing the nation's money supply? A) The Federal Reserve Bank of New York B) The United States Treasury C) The Federal Open Market Committee D) The American Association of Bankers 21. The Fed's most important and most frequently used tool of monetary policy is A) moral suasion. B) open-market operations. C) changes in the discount rate. D) changes in required reserve ratios.

MACROECONOMICS FOR TODAY

10th Edition

ISBN:9781337613057

Author:Tucker

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Chapter14: Money And The Federal Reserve System

Section14.4: What A Federal Reserve Bank Does

Problem 1YTE

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Why and when was the Federal Reserve created? 1) The Fed was created by the New Deal in 1934 to supervise national investment in publIc works 2) The Fed was created in 1913 in order to supervise banks and to control the money supply. 3) The Fed was created by John Quincy Adams in 1829, abolished by Andrew Jackson in 1831, and reconstituted by Theodore Roosevelt in 1909 as the official national bank tt the guarantor and the obligor for all commercial (not investment) banks 4) None of the above
A) Explain whether each of the following events increases or decreases the money supply. 1) The State Bank of Pakistan sells bonds in open-market operations. 2) The State Bank of Pakistan increases the reserve requirement. 3) The State Bank of Pakistan reduces the interest rate it pays on reserves. 4) MCB Bank repays a loan it had previously taken from the State Bank of Pakistan. 5) After a rash of pickpocketing, people decide to hold less currency. 6) Fearful of bank runs, bankers decide to hold more excess reserves.
11) Which of the following increases the quantity of money? A) an individual's cash withdrawal from a bank B) an individual's purchase of a government security from the Fed C) the Fed's purchase of a government security D) an increase in the government's budget deficit 12) Open market purchases by the Federal Reserve System (the Fed) A) raise the federal funds rate. B) increase bank reserves. C) occur when the Fed wants to decrease the quantity of money. D) All of the above answers are correct. 13) When the Fed raises the federal funds rate, A) net exports increase. B) the value of the dollar falls on the foreign exchange market. C) the value of the dollar rises on the foreign exchange market. D) consumption increases. 14) If the Fed raises the federal funds rate so that the exchange rate rises, then imports ________ and exports ________. A) increase; increase B) increase; decrease C) decrease; increase D)…
40. If the Fed pursues expansionary monetary policy then Group of answer choices the money supply will increase, interest rates will fall and GDP will rise the money supply will decrease, interest rates will rise and GDP will fall. the money supply will decrease, interest rates will rise and GDP will fall. the money supply will increase, interest rates will rise and GDP will rise.
Which of the following is the role of the Federal Reserve System? Select one: a. Set the Required Reserve Ratio for Bank of America b. Manage the account for South Carolina and other state governments c. Make loans to local businesses d. Print new money e. All of these are roles of the Fed
1. The growth rate of the money supply in a particular year was 8.5%. What was the growth rate of real GDP if the inflation rate in the same year was 4%? 2. During a recession, the Fed enacts countercyclical policy, by changing the quantity of reserves. To fight recession, how will the Fed adjust the quantity of reserves in the market (to S₁ or S₂)? Explain how the Fed can operationalize that. Fed funds rate () S I 1 I I 1 T I 1 1 1 1 I || I I 1 1 1 1 So I I 1 1 I 1 I I 1 1 I 1 1 J I I 1 1 + I I I I 2 D Quantity of reserves 3. Explain why the zero lower bound is a problem for monetary policy. If there's a recession and the Central Bank is at a zero lower bound, what monetary policies can it pursue to stimulate the economy?
1 **************** 1) Consider the US Federal Reserve System and compare it with another central bank in a major country, such as the Bank of England, the European Central Bank, the Bank of Japan, the Reserve Bank of India, etc. a)What are two features, characteristics, or practices of the second central bank that you chose to compare with the FED that are very similar to the FED? b)What are two features of that central bank that differ significantly from the FED? Explain. P.S. CHOOSE BANK OF JAPAN

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19.	The Federal Reserve System was established in 1913 in response to the
	A)	First World War.
	B)	bank panic of 1907.
	C)	depression of 1883.
	D)	prosperity of the 1920s.

20.	Which organization is responsible for managing the nation's money supply?
	A)	The Federal Reserve Bank of New York
	B)	The United States Treasury
	C)	The Federal Open Market Committee
	D)	The American Association of Bankers

21.	The Fed's most important and most frequently used tool of monetary policy is
	A)	moral suasion.
	B)	open-market operations.
	C)	changes in the discount rate.
	D)	changes in required reserve ratios.