econ test 3
When the Fed lends to depository institutions, the loans are called A) federal funds. B) discount loans. C) repurchase agreements. D) reverse repurchase agreements.
discount loans
the primary assets of the fed are
discount loans and government securities
which of the following is an asset of the fed?
discount loans to banks
what is the most direct method the fed uses to change the monetary base
open market operations
the percentage of deposits that banks must hold as reserves is called the
required reserve ration
in august 2016, the largest liability of the fed was
reserves
which of the following is a liability of the fed
reserves
open market operations generally involve
the Fed buying and selling U.S. government securities.
as of august 2016, the value of currency in circulation was about
1.4 trillion
If the Fed buys securities worth $10 million, then
A) bank reserves will increase by $10 million.
Vault cash is a(an)
A) liability of the Fed and is counted as reserves.
Reserves equal
deposits with the Fed plus vault cash.
the feds portfolio of securities consists principally of
U.S treasury obligations
if the fed purchases securities worth $10 million from a commercial bank, the banking systems balance sheet will show
a decrease in securities held of $10 million and an increase in bank reserves of $10 million
the monetary base is equal to
all currency in circulation plus reserves held by banks
reserve deposits are
assets for financial institutions, but liabilities for the Fed
As of August 2016, which of the following was TRUE?
bank reserves>currency in circulation> deposits of foreign government and international organizations
which of the following is a liability of the fed?
currency in circulation
when the fed extends loans to depository institutions
it increases the level of reserves
the interest rate the fed charges on loans to depository institutions is known as
the discount rate
the paper currency of the united states is issued by
the fed
the difference between currency outstanding and current in circulation is equal to
vault cash
If the Fed purchases $1 million in securities from the nonbank public, the monetary base will rise by $1 million
whether the public holds the proceeds as currency or deposits them as checkable deposits