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Question
If the required reserve ratio is 10 percent, currency in circulation is $400 billion, checkable deposits are $1000 billion, and excess reserves total $1 billion, then the monetary base isa. $400 billion.
b. $401 billion.
c. $500 billion.
d. $501 billion.
Answer
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Related questions
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The organization responsible for the conduct of monetary policy in the United States is the
A. Comptroller of the Currency.
B. U.S. Treasury.
C. Federal Reserve System.
D. Bureau of Monetary Affairs.
Q:
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A. balanced budgets.
B. rapidly growing money supplies.
C. falling money supplies.
D. constant money supplies.
Q:
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A. exchanges.
B. banks.
C. over-the-counter markets.
D. finance companies.
Q:
Banks, savings and loan associations, mutual savings banks, and credit unions
A. are no longer important players in financial intermediation.
B. since deregulation now provide services only to small depositors.
C. have been adept at innovating in response to changes in the regulatory environment.
D. produce nothing of value and are therefore a drain on society's resources.
Q:
Which of the followings does NOT describe the goods market in the ISLM model?
A. consumption function
B. investment function
C. government spending and tax
D. money demand function
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B. rises; falls
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Q:
An autonomous increase in money demand, other things equal, shifts the ________ curve to the ________.
A. IS; right
B. IS; left
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Q:
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A. exceeds; rise; right
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Q:
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A. demand; right
B. demand; left
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Q:
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A. a Taylor rule.
B. a discretionary policy.
C. a policy rule advocated by monetarists.
D. advocated by activists.
Q:
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B. the Lucas critique.
C. public choice theory.
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Q:
The Lucas critique indicates that
A. advocates of discretionary policies' criticisms of rational expectations models are well-founded.
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C. expectations are important in determining the outcome of a discretionary policy.
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Q:
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A. is horizontal.
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Q:
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Q:
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B) undergone dollarization.
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Q:
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A) IMF
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Q:
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C. aggregate output is stabilized.
D. all of the above.
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Q:
When the economy suffers a permanent negative supply shock and the central bank does not respond by changing the autonomous component of monetary policy, then
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C. output will be lower.
D. inflation will not change.
E. both B and C.
Q:
If the economy suffers a permanent negative supply shock because there is an increase in regulations that permanently reduce the level of potential output, then
A. potential output falls.
B. the long-run aggregate supply curve shifts leftward.
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Q:
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Q:
With the policy rate set at zero, the rise in expected inflation will lead to a ________ in the real interest
rate, which will cause investment spending and aggregate output to ________.
A. fall; rise
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Q:
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B. Instead of relying solely on the economy's self-correcting mechanism, much more aggressive fiscal expansions than those of the U.S. (in addition to a substantial monetary easing) served to shift the AD curve back to general equilibrium relatively quickly.
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E. None of the above.
Q:
Explain and demonstrate graphically the effects of a negative supply shock in both the short-run and long-run.
Q:
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A. increase; increase
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Q:
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A. An increase; appreciate
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A. right; appreciate
B. right; depreciate
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