14.2

The largest asset of the Fed from those on this list is

U.S. Treasury securities.

The Federal funds market is a market for trading funds between

a bank and another bank.

The new monetary policy tool that the Fed began using in 2008 is

changing the interest rate paid on reserves.

Since the 1930s, the Fed's most important tool for controlling the money supply has been

open-market operations.

Banks in good condition may take out a ________ from the Fed.

primary credit discount rate

Changes in reserve requirements directly and immediately affect

the money multiplier.

How many Federal Reserve Banks are there?

12

Which of the following is not a policy instrument of the Fed?

Changing the federal government budget deficit

Who determines the open-market operations of the Federal Reserve System?

FOMC

When U.S. banks borrow from one another, they must pay the

Fed funds rate.

Which of the Fed's instruments is most frequently used?

Open-market operations

Which of the following best describes the relationship between the Fed funds rate and the discount rate, beginning in 2003?

The Fed funds rate is usually lower than the discount rate.

The primary purpose of the discount window is to

fulfill the bank's lender of last resort role.

The largest liability of the Fed from those on this list is

loans to depository institutions.

The leadership of the Federal Reserve System is provided by

the Board of Governors.

The Federal Reserve is

the central bank of the United States.

The Federal Open Market Committee consists of all the following people EXCEPT

the chairman of the President's Council of Economic Advisors.

If a bank borrows from a Federal Reserve Bank, the interest rate is called

the discount rate.