Bjerknes

"Top Economist"
Mar 16, 2004
116,151
ßüякε;1807397 said:
Okay you Finance fuckers, see what you can do with this:

1) The quantity of reserves demanded equals:
a) total reserves minus excess reserves
b)required reserves plus borrowed reserves
c) excess reserves plus borrowed reserves
d) required reserves plus excess reserves

2)The quantity of reserves demanded rises when the:
a) discount rate rises
b) discount rate falls
c) federal funds rate falls
d) federal funds rate rises

3) In the market for reserves, when the federal funds interest rate is below the discount rate, the supply curve of reserves:
a) negatively sloped
b) horizontal
c) vertical
d) positively sloped
1. d
2. c
3. The fed funds rate is never below the discount rate, sooooo IDK, c?
 
OP
ßöмßäяðîëя
Apr 12, 2004
77,165
  • Thread Starter
  • Thread Starter #13,469
    OP
    ßöмßäяðîëя
    Apr 12, 2004
    77,165
  • Thread Starter
  • Thread Starter #13,473
    Okay Andy:

    When the Fed Funds rate equals the discount rate:
    a) the demand curve for reserves is horizontal
    b) the supply curve for reserves is horizontal
    c) the demand curve for reserves is vertical
    d) the supply curve of reserves is horitobtal

    In the market for reserves, an open market purchase_________the supply of reserves and causes the fed funds interest rate to_________, everything else held constant.
    a) increase, fall b) decrease, fall c) increase, rise d) decrease, rise
     

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