Question

During the financial panic in late 2008, the Fed changed the allocation of assets in its balance sheet away from Treasury bonds toward bank assets.

Question 6 options:

	a) False
	b) True

Question 7 (1 point)

The report that compiles economic conditions collected by the Federal Reserve regional banks is called the:

Question 7 options:

	a) Beige Book.
	b) Reserve Report.
	c) Economic Report.
	d) Red Book.

Question 8 (1 point)

The Fed works independently of political parties.

Question 8 options:

	a) True
	b) False

Question 9 (1 point)

There are two ways for money to be initially deposited into the banking system. They include:

Question 9 options:

	a) a cash deposit by a bank customer and an electronic reserve deposit by the government.
	b) the deposit of a check by a bank customer and a cash deposit by a bank customer.
	c) a cash deposit by a bank customer and a cash deposit by the government.
	d) the deposit of a check by a bank customer and a gold deposit by the government.

Question 10 (1 point)

Assume that the reserve requirement is 20% and the Federal Open Market Committee buys a $100,000 bond. The money supply:

Question 10 options:

	a) increases by a maximum of $20,000.
	b) increases by a maximum of $500,000.
	c) increases by a maximum of $100,000.
	d) decreases by $100,000.

Answer 1

6. a, false

7. a, Beige book

8. a, True

9. d, the deposit of a check by a bank customer and a gold deposit by the government.

10. b, increase by a maximum of$500,000