Homework Answers
It is true that to grow the economy to pull out of a recession, the Federal Reserve should engage in an open market purchase of government securities. This is because by buying government securities, the federal will be giving money in the market and this will increase the money supply in the market. This will also cause the prices to go high due to increase in money supply. Hence it will help the economy grow out of recession.
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Question 43 3.2 pts To grow the economy to pull out of a recession, the Federal...
If severe demand-pull inflation was occurring in the economy, proper government policies would involve a government:...
If severe demand-pull inflation was occurring in the economy, proper government policies would involve a government: 1) deficit, the purchase of securities in the open market, a higher discount rate, and higher reserve requirements. 2) deficit, the sale of securities in the open market, a higher discount rate, and lower reserve requirements. 3) surplus, the sale of securities in the open market, a higher discount rate, and higher reserve requirements. 4) surplus, the purchase of securities in the open market,...
Question 18 2 pts Assume that the Federal Reserve is trying to restrain the economy and...
Question 18 2 pts Assume that the Federal Reserve is trying to restrain the economy and wants to shift the AD curve to the left to do this. Assume the Federal Reserve will accomplish this by using open market operations. In order to do this, the Federal Reserve should buy US government bonds increase the discount rate lower the discount rate sell US government bonds 2 pts Question 21 Assume that the BLS has reported unemployment has risen from 5.1%...
Question 1 3 pts The Federal Open Market Committee (FOMC), buys and sells securities on a...
Question 1 3 pts The Federal Open Market Committee (FOMC), buys and sells securities on a market. O primary O product O factor O secondary Next Not saved Submit Quiz D Question 2 3 pts Which of the following terms is used to describe the proportion of deposits that banks are legally required to deposit with the central bank? Time Attemp 59 Mi O discount requirements O reserve requirements O monetary requirements O deposit requirements Next Previous Not saved Submit...
1 pts D Question 9 Let's assume that the economy is experiencing a recession. A government...
1 pts D Question 9 Let's assume that the economy is experiencing a recession. A government economist advises the president to put pressure on the Federal Reserve Chair to increase the money supply. She also recommends for the government to increase spending on Social Security, welfare programs, roads, highways and other construction projects. According to our text, what are potential disadvantages if this recommendation is implemented? The economy will grow too fast in the short run and unemployment will fall...
If the federal reserve wants to stimulate the U.S. economy, it will use open market operations...
If the federal reserve wants to stimulate the U.S. economy, it will use open market operations to: A. Buy treasury securities from its dealer network. B. Lower the fed funds rate C. Both of the abov D. None of the above Which of the following statements is true concerning market rates? A. a raising market interest rates generally stimulates the economy B. lowering market interest rates generally slows the economy C. Both of the above D. None of the above...
Both A and D are true. Question 17 3 pts Which of the following actions by...
Both A and D are true. Question 17 3 pts Which of the following actions by the Federal Reserve would increase the money supply (other things being equal)? forbidding the reselling of U.S. Treasury securities conducting an open-market purchase of U.S. Treasury securities increasing the discount rate increasing the required reserve ratio None of the above. D Question 18 3 pts 20
BACK TO ASSIGNMENT OVERVIEW Assignment: Federal Open Market Committee (FOM Explain the Federal Open Market Committee...
BACK TO ASSIGNMENT OVERVIEW Assignment: Federal Open Market Committee (FOM Explain the Federal Open Market Committee Open Market Operations, and the Federal Funds Rate Question Which of the following is true of open market operations? Select the correct answer below 0 Open market operations involves the buying and selling of stocks on the New York Stock Exchange O Open market operations target the amount of currency in the market. O Open market operations involve the purchase and sale of government...
When an economy is experiencing a recession and the MPC = 4/5, a $5 billion dollar increase in government spending will cause output to increase by
1. When an economy is experiencing a recession and the MPC = 4/5, a $5 billion dollar increase in government spending will cause output to increase by $20 billion $400 million $25 billion $160 million2. Which of the following is the most frequently used monetary policy tool of the Federal Reserve to change the money supply? the discount rate open market operations changing tax rates the required reserve ratio3. During the 2008-2009 recession, the Federal Reserve provided additional liquidity into the financial system. This ultimately reduced the federal funds rate, which...
Question 1 20 pts Assume there is concern that the economy is heading into a recession,...
Question 1 20 pts Assume there is concern that the economy is heading into a recession, and a stimulus package of $170 billion is passed by the federal government. Teh administration predicts that this measure will provide an $850 billion boost to GDP this year becasue consumers will spend their extra cash on plasma televisions and other items. For this amount of stimulus, what is the extablished value of MPCused in this forecast? HTMLEditor B uA- L E 3 x...
question 15 QUESTION 15 Interest MS Rate MS, Interest Rate Iz Planned Investment Quantity of Money...
question 15
QUESTION 15 Interest MS Rate MS, Interest Rate Iz Planned Investment Quantity of Money Price Level LRAS SRAS, SRAS AD AD Real GDP in Trillions per Year In the above figure, suppose the economy is at a short-run equilibrium at point and the interest rate is r 2. Which of the following policy options for the Fed will help solve the short-run situation? open market sale of government securities lowering the differential between the discount rate and the...
If severe demand-pull inflation was occurring in the economy, proper government policies would involve a government: 1) deficit, the purchase of securities in the open market, a higher discount rate, and higher reserve requirements. 2) deficit, the sale of securities in the open market, a higher discount rate, and lower reserve requirements. 3) surplus, the sale of securities in the open market, a higher discount rate, and higher reserve requirements. 4) surplus, the purchase of securities in the open market,...
Question 18 2 pts Assume that the Federal Reserve is trying to restrain the economy and wants to shift the AD curve to the left to do this. Assume the Federal Reserve will accomplish this by using open market operations. In order to do this, the Federal Reserve should buy US government bonds increase the discount rate lower the discount rate sell US government bonds 2 pts Question 21 Assume that the BLS has reported unemployment has risen from 5.1%...
Question 1 3 pts The Federal Open Market Committee (FOMC), buys and sells securities on a market. O primary O product O factor O secondary Next Not saved Submit Quiz D Question 2 3 pts Which of the following terms is used to describe the proportion of deposits that banks are legally required to deposit with the central bank? Time Attemp 59 Mi O discount requirements O reserve requirements O monetary requirements O deposit requirements Next Previous Not saved Submit...
1 pts D Question 9 Let's assume that the economy is experiencing a recession. A government economist advises the president to put pressure on the Federal Reserve Chair to increase the money supply. She also recommends for the government to increase spending on Social Security, welfare programs, roads, highways and other construction projects. According to our text, what are potential disadvantages if this recommendation is implemented? The economy will grow too fast in the short run and unemployment will fall...
Both A and D are true. Question 17 3 pts Which of the following actions by the Federal Reserve would increase the money supply (other things being equal)? forbidding the reselling of U.S. Treasury securities conducting an open-market purchase of U.S. Treasury securities increasing the discount rate increasing the required reserve ratio None of the above. D Question 18 3 pts 20
BACK TO ASSIGNMENT OVERVIEW Assignment: Federal Open Market Committee (FOM Explain the Federal Open Market Committee Open Market Operations, and the Federal Funds Rate Question Which of the following is true of open market operations? Select the correct answer below 0 Open market operations involves the buying and selling of stocks on the New York Stock Exchange O Open market operations target the amount of currency in the market. O Open market operations involve the purchase and sale of government...
Question 1 20 pts Assume there is concern that the economy is heading into a recession, and a stimulus package of $170 billion is passed by the federal government. Teh administration predicts that this measure will provide an $850 billion boost to GDP this year becasue consumers will spend their extra cash on plasma televisions and other items. For this amount of stimulus, what is the extablished value of MPCused in this forecast? HTMLEditor B uA- L E 3 x...
question 15
QUESTION 15 Interest MS Rate MS, Interest Rate Iz Planned Investment Quantity of Money Price Level LRAS SRAS, SRAS AD AD Real GDP in Trillions per Year In the above figure, suppose the economy is at a short-run equilibrium at point and the interest rate is r 2. Which of the following policy options for the Fed will help solve the short-run situation? open market sale of government securities lowering the differential between the discount rate and the...
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