QUESTION 1 12.5 points Save Answer Suppose that the Fed wants to increase money supply using open-market operations. A purchase of short-term government bonds in the amount of $10 min will increase money supply by O A. $10 min O B. less than $10 min O C. more than $10 min QUESTION 2 12.5 points Save Answer Suppose that for every open-market operation in the amount of $1, money supply increases by $3, i.e., an open-market purchase of $1 will increase money supply by $3 and an open-market sale of $1 will reduce money supply by $3. This means that money multiplier is fixed and is equal to 3. The Fed's balance sheet is Federal Reserve Bank Assets Liabilities Securities $ 900 Currency held by nonbank public $ 700 Gold 100 Vault cash held by banks 100 Reserve deposits 200 Total assets $1000 Total liabilities $1000 and the commercial banks' balance sheet is Consolidated Balance Sheet of Banks Assets Liabilities Vault cash $ 100 Deposits $3000 Reserve deposits 200 Loans 2700 Total assets $3000 Total liabilities $3000 If the Fed wants to increase money supply by 15%, then it has to buy government bonds in the amount of Click Save and Submit to save and submit. Click Save All Answers to save all answers. Save All Answers Save and SubmitLoans 21w Total assets 3\" Total liabilities m ______ If the Fed wants to increase money supply by 15%, then it has to buy government bonds in the amount of Note: Type in your answer rounded to two decimal places, i.e., your answer must be of the form \"999.99\". I will not be able to x correct answers that were entered incorrectly, such as \"999.999" or \"999,99\" or \"999". In case the last digit in the correct answer is zero, e.g., \"999.90\" or \"999.00\QUESTION 5 12.5 points Save Answer Which of the following statements is correct? A. monetary policy was contractionary during the Great Recession and contractionary during the COVID Recession O B. monetary policy was expansionary during the Great Recession and expansionary during the COVID Recession O C. monetary policy was contractionary during the Great Recession and expansionary during the COVID Recession O D. monetary policy was expansionary during the Great Recession and contractionary during the COVID Recession QUESTION 6 12.5 points Save Answer Four panels in the figure below show four different evolutions of an economy's output over a year. In all figures, the solid line depicts the actual level of output, the dashed line stands for the full-employment output, and the markered line shows the interest rate set by the central bank Panel A Panel B 102.50 0.06 101.00 0.05 102.00 0.05 100.80 0.04 101.50 0.04 100.60 100.40 0.03 101.00 0.03 100.20 100.50 100.00 0.02 0.02 100.00 - 0.01 99.80 0.01 99.60 99.50 0 99.40 0 99.00 -0.01 99.20 -0.01 Jul-20 Jul-20 Jan-20 Jun-20 Oct-20 Oct-20 Jan-20 Dec-20 Jun-20 Apr-20 Sep-20 Aug-20 Nov-20 Feb-20 Dec-20 Mar-20 Apr-20 Sep-20 May-20 Aug-20 Mar-20 Nov-20 Feb-20 May-20 - actual output (left axis) actual output (left axis) - - full-employment output (left axis) - - full-employment output (left axis) arnot rats fright avial interact eats fright avial Click Save and Submit to save and submit. Click Save All Answers to save all answers. Save All Answers Save and SubmitPanel C 101.00 100.50 100.00 99.50 99.00 98.50 888888828888 8 actual output (left axis) - fullemployment output (left axis) 0 interest rate (r'ght axis) 0.04 0.03 0.02 0.01 -0.01 101.00 100 .00 99.00 98.00 97.00 96.00 95.00 94.00 93.00 92.00 c '7' = n _, Panel D .w.;wwbww; .9..- : a. Q : eg