1. Define the term Eurodollar. Can a U.S. bank create Eurodollars? How? 2. Please describe the process...
Question:
1. Define the term Eurodollar. Can a U.S. bank create Eurodollars? How?
2. Please describe the process by which Eurocurrency deposits are created. What happens to the total volume of domestic bank reserves and deposits in the process of creating Eurocurrency deposits?
3. Can Eurocurrency deposits be destroyed? How can this happen?
4. What are the principal sources of Eurocurrency deposits? What are their uses?
5. What role do Eurodollar deposits play in reserve management operations of U.S. banking firms? What are the advantages of Eurodollar borrowings over other sources of reserves for banks? What about the disadvantages?
6. Please evaluate the Eurocurrency markets from a social point of view. What are their major benefits and costs to the public and to market participants? In your opinion should these markets be more closely regulated or be relatively free of regulation?
7. What are the Federal Reserve's primary jobs (that is, its principal roles or functions)?
8. What is/are the principal target(s) of monetary policy?
9. What arelegal reserves?Required reserves?Excess reserves? Why are these concepts important?
10. Describe the effects of the credit crisis of 2007-2009 on the powers and policies of the Federal Reserve.
11. Why are open market operations increasingly the most popular and frequently used monetary policy tool? What are the principal effects of open market operations on the financial system?
12. What is moral suasion? Do you believe this tool can be effective?
13. What are the principal economic goals of the Federal Reserve System? How could the Fed cause changes in the rate of inflation? In unemployment and economic growth? In the nation's balance-of-payments position?
14. How numerous are bank failures and what seem to be their most important causes?
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill