Given your answers to Question 7, what, if anything, would you expect to happen to

(a) housing investment,

(b) plant and equipment investment,

(c) intended inventory investment,

(d) government expenditures,

(e) consumption,

(f) exports, and (g) imports? Why?

Question 7

What effects are decreases in reserve requirements likely to have on

(a) bank reserves,

(b) federal funds rates,

(c) bank lending,

(d) Treasury bill rates, and

(e) the bank prime rate? Explain your answers.