If the Federal Reserve increases the discount rate from 12 percent to 14 percent banks will borrow Multiple Choice more reserves from the Fed and lending will decrease. fewer reserves from the Fed and lending will decrease. more reserves from the Fed and lending will increase. fewer reserves from the Fed and lending will increase

If the Federal Reserve increases the discount rate from 12 percent to 14 percent banks will borrow Multiple Choice more reserves from the Fed and lending will decrease. fewer reserves from the Fed and lending will decrease. more reserves from the Fed and lending will increase. fewer reserves from the Fed and lending will increase

MACROECONOMICS FOR TODAY

10th Edition

ISBN:9781337613057

Author:Tucker

Publisher:Tucker

Chapter14: Money And The Federal Reserve System

Section: Chapter Questions

Problem 11SQ

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If the Federal Reserve increases the discount rate from 14 percent to 16 percent banks will borrow Multiple Choice fewer reserves from the Fed and lending will increase. fewer reserves from the Fed and lending will decrease. more reserves from the Fed and lending will increase. more reserves from the Fed and lending will decrease.
When you open a checking account at Bank of America, Bank of America has more reserves and more excess reserves. has more reserves, but excess reserves remain unchanged. has more deposits and less in excess reserves. has more deposits, but excess reserves remain unchanged.
Distinguish between legally required reserves and excess reserves.
A bank has outstanding loans of $7,500, reserves of $2,500, and deposit liabilities of $10,000. If the required reserve ratio is 10%, this bank: A. Is holding excess reserves of $1,000 B. Is in a position to make a new loan for $1,500 C. Is in a position to make a new loan for $2,500 D. Has less reserves than required
Question 26 A commercial bank has excess reserves of $10,000 and a required reserve ratio of 20%. It grants a loan of $8,000 to a customer, who then writes out a check for $8,000 that is deposited in another bank. The first bak will find its reserves decrease by: $3,000 $2,000 $1,600 $8,000 Next Page Page 26 of 35
When a bank issues a loan to a customer: A) bank assets fall by the amount of the loan. B) the composition of bank assets changes so that bank reserves increase and the value of bank loans decreases. C) bank assets rise by the amount of the loan. D) the composition of bank assets changes so that bank reserves decrease and the value of bank loans increases.
The Federal Reserve System is the central bank of the United States. It has 12 regional banks and 24 branches throughout the country. Search the web and find the Fed regional Bank and Branch which serves the state of Alabama. Among 12 regional Fed Banks, which bank is the largest in assets and the second largest in assets
2
A bank's reserve ratio is 8 percent and the bank has $1,000 in deposits. Its reserves amount to
A bank's checkable deposits are $960, its loans are $857 and the bank has reserves of $103. If the bank faces a required reserve ratio of 9%, then what are the bank's current excess reserves?
If banks require 10% of transaction deposit in reserve, How much is the required reserve? How much is the excess reserve?
Required reserves with a bank equal A) Total reserves plus excess reserves B) Excess reserves minus demand deposits C) Total reserves minues excess reserves D) Demand deposits plus savings account