Exam 15: Tools of Monetary Policy

In the market for reserves,if the federal funds rate is between the discount rate and the interest rate paid on excess reserves,an increase in the reserve requirement ________ the demand of reserves and causes the federal funds interest rate to ________,everything else held constant.

The most common type of discount lending that the Fed extends to banks is called

Everything else held constant,in the market for reserves,when the demand for federal funds intersects the reserve supply curve along the horizontal section,increasing the discount rate

In the market for reserves,if the federal funds rate is above the interest rate paid on excess reserves,an open market sale ________ the ________ of reserves,causing the federal funds rate to increase,everything else held constant.

When good weather speeds the check-clearing process,float tends to ________ causing the Fed to initiate defensive open market ________.

The discount rate refers to the interest rate on

In the market for reserves,if the federal funds rate is above the interest rate paid on excess reserves,an open market sale ________ the supply of reserves causing the federal funds rate to ________,everything else held constant.

The interest rate on secondary credit is set ________ basis points ________ the primary credit rate.

Discount policy affects the money supply by affecting the volume of ________ and the ________.

Which of the following is NOT an argument for the Federal Reserve paying interest on excess reserve holdings?

The interest rate for primary credit is usually set ________ basis points ________ the federal funds rate. In March 2008,this gap was changed to ________ basis points.

The quantity of reserves supplied equals

The equivalent to the Federal Reserve's discount rate in the European System of Central Banks is the

Which of the following monetary policy tools is more effective when the economy faces the interest rate zero-lower-bound problem?

An increase in ________ reduces the money supply since it causes the ________ to fall.

From before the financial crisis began in September of 2007 to when the crisis was over at the end of 2009,the huge expansion in the Fed's balance sheet and the monetary base did not result in a large increase in monetary supply because

Everything else held constant,when the federal funds rate is ________ the interest rate paid on reserves,the quantity of reserves demanded rises when the federal funds rate ________.

Everything else held constant,in the market for reserves,when the federal funds rate is 3%,lowering the interest rate paid on excess reserves rate from 2% to 1%

When the Fed wants to raise interest rates after banks have accumulated large amounts of excess reserves,it would

Suppose on any given day the prevailing equilibrium federal funds rate is above the Federal Reserve's federal funds target rate.If the Federal Reserve wishes for the federal funds rate to be at their target level,then the appropriate action for the Federal Reserve to take is a ________ open market ________,everything else held constant.