Econ 3229 Ch 17

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Econ 3229 Ch 17

  
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1.  1. Each of the following items would appear as assets on the central bank's balance sheet, except: 
A.
B.
C.
D.
2.  2. The main asset held by a central bank is: 
A.
B.
C.
D.
3.  3. A central bank holds foreign exchange reserves primarily for: 
A.
B.
C.
D.
4.  4. For the Federal Reserve, the largest liability on its balance sheet is: 
A.
B.
C.
D.
5.  5. Reserves are: 
A.
B.
C.
D.
6.  6. Vault cash is: 
A.
B.
C.
D.
7.  7. Monetary policy operations for central banks are run through changes in the liability category of: 
A.
B.
C.
D.
8.  8. The monetary base is the sum of: 
A.
B.
C.
D.
9.  9. A central bank's sale of securities from its portfolio will: 
A.
B.
C.
D.
10.  10. Consider a $2 billion open market purchase of U.S. Treasury securities by the Federal Reserve. The Fed's balance sheet will specifically show:  
A.
B.
C.
D.
11.  11. An open market sale of U.S. Treasury securities by the Fed will cause the Banking System's balance sheet to show: 
A.
B.
C.
D.
12.  12. The Fed sells German bonds to commercial banks. Which of the following best describes the impact on the Fed's and the Banking System's balance sheets resulting from this transaction? 
A.
B.
C.
D.
13.  13. When the Fed makes a discount loan, the impact on the Fed's balance sheet is: 
A.
B.
C.
D.
14.  14. Tom decides to withdraw $300 out of his checking account. The impact of this transaction on the Fed's balance sheet will be: 
A.
B.
C.
D.
15.  15. The term for turning reserves into bank deposits is called: 
A.
B.
C.
D.
16.  16. If Bank A sells a $100,000 U.S. Treasury bond to the Fed, Bank A's excess reserves will: 
A.
B.
C.
D.
17.  17. Bank A has checkable deposits of $100 million, vault cash equaling $1 million and deposits at the Fed equaling $14 million. If the required reserve rate is ten percent what is the maximum amount Bank A could lend? 
A.
B.
C.
D.
18.  18. If the required reserve rate is ten percent and banks do not hold any excess reserves and there are no changes in currency holdings, a $1 million open market purchased by the Fed will result in deposit creation of: 
A.
B.
C.
D.
19.  19. If the Fed were to increase the required reserve rate from ten percent to twenty percent, the simple deposit expansion multiplier would: 
A.
B.
C.
D.
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