Question

Exhibit 6-2 Civilian Noninstitutional Population (millions) 250 Year Civilian Labor Force (millions) 200 300 400 800 Employed Persons (millions) 175 200 400 500 1000 720 Refer to Exhibit 6-2. The employment rate in year 4 is a. 90 percent. b. 72 percent C. 12.5 percent. d. 10 percent. e. 7.2 percent. QUESTION 43 The demand for reserves curve in the federal funds market is a. horizontal b. downward sloping. C. vertical. d. upward sloping. QUESTION 44 When commercial banks need more Federal Reserve Notes, a. they call their Federal Reserve District Bank, which delivers the requested amount b. they ask their customers to exchange their Federal Reserve Notes for U.S. Treasury securities. c. they call the Board of Governors of the Fed, which delivers the requested amount. d. they call the Treasury, which delivers the requested amount. e. they call the Bureau of Engraving and Printing, which delivers the requested amount.

Answer 1

1 - Option D

10 %

Unemployment rate = (800-720)/800* 100

= 80/800*100

= 10 %

2 - Option B

Downward sloping

This is because the inverse relation between federal funds rate and demand for reserves

3 - Option B

They ask the customers to exchange their federal reserve notes in return for the US treasury securities.