11.People view cell phone and its charger as complements to one another. If theprice of cell phone increases, economists would expect:O The demand for charger will not change.O The demand for charger to increase.O The quantity of cell phone demanded to increaseO The demand for charger to decrease.12.Which one is not the role of the Fed?O The Fed also acts as a bank to the American citizens with net wealth is larger than10 million dollar.O The Fed also acts as a bank to other banks by clearing checks, making electronicpayments, and providing the currency that American's need and use every day.O The Fed also helps to supervise and regulate the nation's banks and works topromote a stable financial system for consumers, communities, and businessesThe Fed implements monetary policies that promote maximum employment and mstable prices.

11. We have to found complementary goods.

11. People view cell phone and its charger as complements to one another. If the price of cell phone increases, economists would expect: O The demand for charger will not change. O The demand for charger to increase. O The quantity of cell phone demanded to increase O The demand for charger to decrease.

11. People view cell phone and its charger as complements to one another. If the price of cell phone increases, economists would expect: O The demand for charger will not change. O The demand for charger to increase. O The quantity of cell phone demanded to increase O The demand for charger to decrease.

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter14: Banking And The Money Supply

Section: Chapter Questions

Problem 4.9P

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Which of the following about saving deposits a-under M2 supply, they they are bank accounts that you cannot white a check from directly. generally moneyl to be kept asided. you can easily withdraw money cash from these aacounts at an automatic teller machine or back d- included in M1 money supply these are the monies held in checking accounts. they are called demand deposits or chekable deposits because the bank must give the deposit holder his money on demand when a check is written or a debit card is used c- included in M1 money supply therefore, very lliquid these are coins and bills that vcirvulate in an economy that are NOT held by the US treasury Federal reserve bank, or in any bank vaults so the cash you havae in your wallet pocket right now d- under M2 money sypplly funds that you invest in where the deposits of many investors are pooled together and invested in a safe way such as short term goverment bods.
3. Suppose the reserve requirement for the United States is 8%. Instructions: Round your answers to the nearest whole number. a. Suppose the Federal Reserve wants to increase the money supply. What should it do to accomplish this goal? billion. The Fed could make an open market purchase v of $30 billion, resulting in a total increase in the money supply of $| b. Now suppose the Fed wants to decrease the money supply. What should it do to accomplish this goal? billion. v of $20 billion, resulting in a total decrease in the money supply of $ The Fed could make an open market sale
The economy grows (GDP increases) but the central bank moves to keep interest rates constant. Select one: O a. money demand decreases, money supply is unchanged and interest rates decrease O b. money demand increases, money supply is unchanged and interest rates increase 1O c. money demand decreases, money supply increases and interest rates remain unchanged O d. money demand increases, money supply decreases and interest rates remain unchanged money demand increases, money supply is unchanged and interest rates is unchanged O e.
18. Suppose the Fed decreases the discount rate. How does this policy affect the money supply? OIncrease money supply ONo change in money supply ODecrease money supply
The table below describes two different demands for money and the supply of money. Answer the following questions based on this table. Instructions: Enter your answers as a whole number. Total Demand for Money Price of Money Money Supply Demand 1 Demand 2 Total Money Demand 1 $400 $300 $150 $ 2 400 250 150 3 400 200 150 400 150 150 5 400 100 150 a. What is the price of money? O Consumer Price Index O Interest rate O Inflation rate O Production rate b. What type of demand for money does Demand 1 represent? O Unit-of-account demand O Asset demand O Total demand O Transaction demand c. What type of demand for money does Demand 2 represent? O Total demand O Unit-of-account demand O Transaction demand O Asset demand d. Complete the "Total Money Demand" column in the above table.
19. If the Fed reduces the money supply to reduce inflation: a) the interest rate will increase, and the price of US exports will fall and the price of US imports will rise. b) the interest rate will increase, and the price of US exports will rise and the price of US imports will fall. c) the interest rate will increase, and the price of both US exports and US imports will rise. d) the interest rate will increase, and the price of both US exports and US imports will fall.
In 2019, The Fed was liquidating their balance sheet (meaning they were selling off the bonds and securities purchased in The Great Recession 2007-2009). That means they are trying to do what in regards to the supply of money. O Increase O Decrease O Create a money stream to increase supply of money O Increase their Capital Gains
The economy recently experienced an increase in the number of tourist arrivals, increasing income throughout the island. Select one: O a. money supply increase, money demand increase, interest rate decrease O b. money supply unchanged, money demand increase, interest rate increase Oc. money supply unchanged, money demand decrease and interest rate decrease O d. money supply increase, money demand unchanged, interest rate decrease O e. money supply decrease, money demand unchanged, interest rate increase
The central bank sold existing government securities in an open market operation. Which of the following changes is the most likely result of this action? Select one: a. The reserve requirement decreases. O b. The nominal interest rate increases. O c. The discount rate increases O d. Bank reserves increase.
Economics To increase the money supply, what could the Federal Reserve do? Choose one or more: OA. make an open market sale OB. decrease the discount rate O Cincrease income taxes OD. increase the discount rate O E. make an open market purchase
In the graph below (the market for money), the Rate of interest price of a dollar 12 10 8 4 2 50 ✔interest rate ✔price of borrowing or lending money O purchasing power S 100 250 Quantity of money demanded & supplied (billions of dollars) 150 is determined by the total demand for money intersecting with the total supply of money. 200 D
The following table gives the quantity of money demanded at various price levels (P), the money demand schedule. In the following table, fill in the column labeled Value of Money. Price Level (P) Value of Money (1/P) 0.80 1.00 1.33 2.00 Now consider the relationship between the quantity of money that people demand and the price level. The lower the price level, the required to complete transactions, and the money people will want to hold in the form of currency or demand deposits. Assume that the Federal Reserve initially fixes the quantity of money supplied at $3.5 billion. VALUE OF MONEY 8 Use the orange line (square symbol) to plot the initial money supply (MS) set by the Fed. Then, referring to the previous table, use the blue connected points (circle symbol) to graph the money demand curve. 2.00 1.75 1.50 1.25 1.00 0.75 Quantity of Money Demanded (Billions of dollars) 1.5 2.0 3.5 0.50 025 0 7.0 3 QUANTITY OF MONEY (Billions of dollars) 7 101 MS, Money Demand M money ?