Question: Question 429 pts Based on the textbook, the Instructor Comments and Appendix 1 to Chapter 17, for each of the following actions or changes, decide
Question 429 pts
Based on the textbook, the Instructor Comments and Appendix 1 to Chapter 17, for each of the following actions or changes, decide whether, ceteris paribus, there would be an increase, a decrease, or no change in the monetary base.
Group of answer choices
The New York Fed spends $1 billion updating its computer system to improve trading in government securities.
[ Choose ] decrease increase no change
The Fed lowers the required reserve ratio.
[ Choose ] decrease increase no change
The Fed buys $10 billion worth of Treasury Bills from its portfolio.
[ Choose ] decrease increase no change
The Fed begins "backing out" of its large portfolio of non-government securities and sells $100 billion worth of mortgage-backed securities.
[ Choose ] decrease increase no change
You deposit $1000 in currency into your checking account and hold it as cash.
[ Choose ] decrease increase no change
The Treasury gets $200 billion in tax payments and deposits the checks in its account at the Fed
[ Choose ] decrease increase no change
Foreign central banks shift $1 billion they own from U.S. commercial banks into deposits at the Fed.
[ Choose ] decrease increase no change
The U. S. Treasury shifts $100 billion from its account at the Fed to its "tax and loan" accounts in private commercial banks.
[ Choose ] decrease increase no change
A banking panic causes consumers to withdraw cash from checking accounts and banks to hold more excess reserves.
[ Choose ] decrease increase no change
Flag question: Question 43
Question 439 pts
Based on the textbook, the Instructor Comments, and Appendix 2 to Chapter 17, for each of the following changes, decide whether it would cause the money multiplier (m) to increase or decrease or remain unchanged. (NOTE: in most cases you will have to first think in terms of how the change would affect ER/D or C/D or rD , and then decide how the change in that variable would affect the money multiplier).
Group of answer choices
A recession decreases income and wealth
[ Choose ] decrease increase no change
The Fed lowers the required reserve ratio
[ Choose ] decrease increase no change
Congress eliminates the FDIC and there is no more deposit insurance
[ Choose ] decrease increase no change
The government significantly lowers marginal tax rates
[ Choose ] decrease increase no change
The Fed stops paying interest on excess reserves held by banks at the Fed
[ Choose ] decrease increase no change
Banks stop paying interest on demand deposits
[ Choose ] decrease increase no change
The Fed sells U.S. Treasury Bills.
[ Choose ] decrease increase no change
The Fed raises its target federal funds range
[ Choose ] decrease increase no change
The Fed engages in quantitative easing
[ Choose ] decrease increase no change
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