![123iamthe1](/avatars/1327.jpg)
123iamthe1
03.12.2021 •
Mathematics
5. The reserve requirement, open market operations, and the money supply
Assume that banks do not hold excess reserves and that households do not hold currency, so the only form of money is checkable deposits. To simplify
the analysis, suppose the banking system has total reserves of $500. Determine the simple deposit multiplier and the money supply for each reserve
requirement listed in the following table.
Reserve Requirement
(Percent)
Simple Deposit Multiplier
Money Supply
(Dollars)
5
ما
10
10
A lower reserve requirement is associated with a
money supply.
Suppose the Federal Reserve wants to increase the money supply by $200. Again, you can assume that banks do not hold excess reserves and that
households do not hold currency. If the reserve requirement is 10%, the Fed will use open-market operations to buy $
worth of
U.S. government bonds.
Now, suppose that, rather than immediately lending out all excess reserves, banks begin holding some excess reserves due to uncertain economic
conditions. Specifically, banks increase the percentage of deposits held as reserves from 10% to 25%. This increase in the reserve ratio causes the
multiplier to to. Under these conditions, the Fed would need to
worth of U.S. government bonds in order to
increase the money supply by $200.
Which of the following statements help to explain why, in the real world, the Fed cannot precisely control the money supply? Check all that apply.
The Fed cannot control whether and to what extent banks hold excess reserves.
The Fed cannot control the amount of money that households choose to hold as currency.
The Fed cannot prevent banks from lending out required reserves.
Solved
Show answers
More tips
- H Health and Medicine How to Improve Eyesight: Science-based Techniques to Enhance Your Visual Acuity...
- F Family and Home Do Lullabies Help Babies Sleep or Is it Just a Myth?...
- H Health and Medicine Tick Traps: How to Remove Them Safely and Effectively...
- S Society and Politics Why are thugs called gopniks ? A fascinating journey through Russian subculture...
- A Animals and plants Want a Perfect Lawn? Learn How to Plant Grass the Right Way...
- A Animals and plants How to Properly Care for a Pet Decorative Rabbit at Home?...
- C Computers and Internet How to Check the Speed of My Internet?...
- H Health and Medicine 10 Ways to Cleanse Your Colon and Improve Your Health...
- W Work and Career How to Write a Resume That Catches the Employer s Attention?...
- C Computers and Internet Е-head: How it Simplifies Life for Users?...
Answers on questions: Mathematics
- M Mathematics The figure oelow is a composite of a semicircle and a trapezoid. 9 cm 4 cm 5 cm Which measurement is closest to the area of the composite figure? A 91.6 cm? C 68.4 cm?...
- M Mathematics GIVING BRAINLIEST!! PLS HELP :(( Bella chose a power of 10 and multiplied it with 23. The product is 2,300,00. What power of 10 did bella chose?...
- M Mathematics What is the factorization of the polynomial below? x^2 - 5x-36...
- M Mathematics Multiplying powers Add the bases together Multiply the bases Combine coefficients and leave the exponents alone Add exponents on identical bases...
- M Mathematics 9) $36,500 at 2% compounded semiannually for 2 years A) $37,993.74 B) $37,982.05 C) $37,960.00 D) $37,974.60...
- M Mathematics Boy friend (FnF) Gives you free point s What do you do? A Say thank you B Beep boop him C crush his blue balls D steal his girl....
- M Mathematics Mr. Abbey bought 8 plates and 12 drinking cuos from a shop. a plate cosr him ¢5 more than a drinking cup. if he spent ¢940 altogether, how much did a plate and a drinking...
- M Mathematics No pic just type answer pls....
- M Mathematics last year marina earned 35000 from one job and 25000 from a another job. she puts 3600 in her saving account. what percent of her total income did she put into saving...
- M Mathematics Help me with this plz no links...
Ответ:
answer: what is the question you're trying to ask?
step-by-step explanation: