Exam 15: Tools for Monetary Policy

If the Fed expects currency holdings to fall,it conducts open market ________ to offset the expected ________ in reserves.

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 ________ for reserves and causes the federal funds interest rate to rise,everything else held constant.

When the European System of Central Banks uses long-term refinancing operations,it is similar to the Federal Reserve using

In the market for reserves,a lower interest rate paid on excess reserves

Everything else held constant,in the market for reserves,when the federal funds rate is 5%,lowering the discount rate from 5% to 4%

The Fed's discount lending is of three types: ________ is the most common category; ________ is given to a limited number of banks in vacation and agricultural areas; ________ is given to banks that have experienced severe liquidity problems.

The discount rate refers to the interest rate on

Open market purchases ________ reserves and the monetary base thereby ________ the money supply.

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

Funds held in ________ are subject to reserve requirements.

The primary indicator of the Fed's stance on monetary policy is

The quantity of reserves demanded equals

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

If Treasury deposits at the Fed are predicted to ________,the manager of the trading desk at the New York Fed bank will likely conduct ________ open market operations to ________ reserves.

Which of the following special lending facilities set up by the Federal Reserve is reserve neutral?

Everything else held constant,the vertical section of the supply curve of reserves is shortened when the

When the federal funds rate equals the interest rate paid on excess reserves ________.

________ are the most important monetary policy tool because they are the primary determinant of changes in the ________,the main source of fluctuations in the money supply.

The Federal Open Market Committee makes the Fed's decisions on the purchase or sale of government securities,but these purchases or sales are executed by the Federal Reserve Bank of

The Fed can offset the effects of an increase in float by engaging in