Economics Review

It. sucks, butt. i hate economics.

131 cards   |   Total Attempts: 182
  

Cards In This Set

Front Back
Demand deposits (checkable deposits) are money because they serve as
D) a medium of exchange
The Federal Open Market Comittee of the Federal Reserve System is primarily responsible for
C) setting the Fed's monetary policy by direction the buying or selling of governemnt bonds by Federal Reserve Banks.
In the United States, the money supply designated M1 is compromised of
A) Federal Reserve Notes, coins, demand deposits and traveler's checks.
Which of the follwoing statements most accurately describes the twelve Federal Reserve Banks?
C) They are privately owned and publically controlled central banks whose basic function is to control interest rates and the money supply in order to achieve economic stability for the nation.
The total demand for money curve will shift to the right as a result of
A) an increse in nominal GDP.
The downward, negative slope of the demand for money is best explained in terms of the
C) the interest rate sensitivity of the asset demand for money.
The money supply curve is vertical because
A) the money supply is determined by the Fed and is not interest rate sensitive.
When cash is deposited in a checking account at a commercial bank, there is
C) no change in the money supply of the economy
The Balcones Banks has actual reserved of $9 million and checkable deposits of $30 million. The required reserve ration is 20 percent. The bank's excess reserves are $ Million.
B) 3
Money is created when
B) a commercial bank or credit union loans money.
The theoretical, maximum amount by which the banking system can expand the money supply of the economy by lending is
A) $120 billion.
When a check is drawn and cleared, the
B) bank against which the check is cleared loses both reserves and depositis equal to the amount of the check.
When the Fed purchases governemnt securities from the public
C) the money supply will increase.
The Federal Reserve System
E) all of the above
When the Fed purchases securities from a bank, bank reserves___and the money supply___ .
C) increses; remains unchanged