Exam 8: Money, the Price Level, and Inflation

Between 2008 and 2009, U.S. real GDP decreased from $13.2 trillion to $12.9 trillion. As a result, the real demand for money ________ and the demand for money curve ________.

A depository institution is a firm that takes deposits from ________ and makes loans to ________.

What is the money multiplier and what affects its size?

This group consists of seven members appointed by the President of the United States for 14-year terms

-In the figure above, if the interest rate is 4 percent, there is a $0.1 trillion excess

The real quantity of money is

Which of the following explains why a bank holds reserves? I.Banks are required by law to hold reserves. II.To meet depositors' currency withdrawals III.To use them to make loans to households

Credit cards are

In the quantity theory of money, the quantity of money is assumed to

University National Bank Balance Sheet Assets Liabilities -The above table has the balance of the University National Bank. All figures are in millions of dollars. The desired reserve ratio is 20 percent. What is the value of excess reserves held by the University National Bank?

-On a given day the quantity of money is ________ and the supply of money curve is ________.

The Second National Bank of Townville has $400,000 in checking deposits, $125,000 in savings deposits, $500,000 in loans, $20,000 in its reserve account at the Fed, and $5,000 of currency in its vault. What is the amount of these assets and liabilities that is in M1?

Bank reserves include I.the cash in the bank's vault. II.the bank's deposits at the Federal Reserve.

The sale of government securities by the Fed leads to

If velocity is 6 and the quantity of money is $2 trillion, what is nominal GDP?

-Liquidity is the same as

The demand for money is ________ related to the nominal interest rate.

-In the figure above, if the interest rate is 6 percent

If the Fed buys $100,000 in U.S. government securities from a commercial bank, the bank now has an additional $100,000 of

The main policy-making body of the Federal Reserve System is the