How do changes the Fed makes affect the average person?Day to day?Or long term?

1.Define or discuss briefly:

National economic policy objectives

Total reserves

Types of transactions that affect bank reserves

Monetary base

Money multiplier

2.Develop a table showing the multiplying capacity in five rounds of a new primary

deposit of $1,000 with 10 percent required reserves.

3.Determine the size of the money multiplier when: the ratio of reserves to total deposits

is 10 percent; the ratio of noncheckable deposits to checkable deposits is 30

percent; currency held by the nonbank public is 20 percent of checkable

deposits; and the ratio of government deposits to checkable deposits is 10

percent. Also determine the money supply if the monetary base is $10 million.

4.Discuss the importance of managing the U.S. Treasury's cash balances in maintaining stable monetary conditions.

5.Describe the techniques used by the Treasury in managing the debt to help achieve an economic climate which would encourage orderly growth and stability.