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Since 2009, how much has been borrowed through the federal funds market?
O. $787 million
O. $43 billion
O. $1,148 billion Incorrect
O. $0
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- Imagine that you are in the position of buying loans in the secondary market (that is, buying the right to collect the payments on loans) for a bank or other financial services company. Explain why you would be willing to pay more or less for a given loan If: The borrower has been late on a number of loan payments Interest rates In the economy as a whole have risen since the bank made the loan The borrower Is a firm that has just declared a high level of profits Interest rates in the economy as a whole have fallen since the bank made the loanMr. Pierpont has wealthof $200,000. He wants to keep at least $80,000 in bonds at all times, and will shift $10,000 into bonds from his checking account for each percentage point that the interest rate on bonds exceeds the interest rate on his checkingaccount. Currently, he keeps $100,000 in bonds, which pay him 7%. What is the current interest rate on checking accounts?A) 5%B) 7%D) 10%C) 9%16. Suppose that the Federal Reserve conducts an open market operation in which it purchases $100 in US Treasury bonds from a private saver. (a) In an economy without banks, by how much, in dollar terms, will the total money supply increase as a result of this open market operation? (b) In an economy with banks in which all members of the nonbank public immedi- ately deposit all of the currency they receive, but in which all banks engage in 100 percent reserve banking, by how much will the total money supply increase as a result of this open market operation? (c) In an economy with banks, in which all banks choose a 10% reserve ratio and in which all members of the nonbank public immediately deposit all of the currency they receive, by how much will the total money supply increase as a result of this open market operation? (d) In an economy with banks, in which all banks choose a 10% reserve ratio, but in which all members of the nonbank public hold 50% of the funds they receive as…
- QUESTION 17 Table Sunshine Community Bank Assets Liabilities Reserves $50,000 $460,000 Deposits $500,000 Loans Refer to Table. Sunshine Community Bank has maintains 4% of their deposits as an excess reserve. What will be money multiplier in this scenario? O a. 10 O b. 16.67 O c. 25 O d. 2023 of 38 Choose the correct description for the following money market instrument. A repurchase agreement is: O A. an overnight loan between banks. o B. a debt instrument sold by a bank to depositors that pays annual interest of a given amount and at maturity pays back the original purchase price. O C. a short-term debt instrument issued by the Canadian government to cover immediate spending obligations. o D. a short-term money market instrument issued primarily by banks and funded from corporations and other banks through loans in which Treasury bills serve as collateral, with an explicit agreement to pay off the debt. Unsure14. Consider the following statements * 1. Bank du Liban decides the extent of borrowings permitted to the Lebanese Government. 2. The borrowing programme of the Lebanese Government is administered by the Ministry of Finance Which of the statements given above is/are correct? O 2 only O Both 1 and 2 Neither 1 nor 2 1 only TOSHIBA
- In regards to savings, an increase in the real interest rate would: Select one: O a. increase the amount of savings and increase the amount of current consumption b. Increase the amount of savings and decrease the amount of current consumption c. decrease the amount of savings and decrease the amount of current consumption O d. decrease the amount of savings and increase the amount of current consumption O O The shadow banking system includes each of the following except: Select one: O O O O a. derivatives. b. hedge funds. c. commercial banks. d. money market funds. Continued long-run economic growth requires that economies: Select one: O O O O a. reach their steady-state levels of capital and output. b. continue to increase their investment rates. c. have high levels of capital stock. d. have institutions in place that encourage research and development of new ideas.• Suppose that a person’s wealth is $50,000 and that her yearlyincome is $60,000. Also suppose that her money demand functionis given by Md = $Y10.35 - i2Derive the demand for bonds. Suppose the interest rate increases by 10 percentage points. What is the effect on her demand for bonds?What are the effects of an increase in income on her demand for money and her demand for bonds? Explain in wordsE E I I I Scenario 1: Suppose the economy is operating at potential GDR. Unemployment is 5%, Infation is running at 11% and the Federal Funds Rate is 8%. In scenario 1 above, what is the real short term interestrate? O 11% O 3N -3% 6% O000O
- Assume that Bank A holds total reserves of $978, the required reserves are $432 and total deposit is $3,600. If the government purchases bonds worth $260 from Bank A, excess reserves of this bank will increase by O $220 O $246.40 O $227.50 $245 $228.80Corry has an income of $80,000 that he is willing to spend over a year. If his bank account's interest rate is 3.05% and the cost associated for him to visit the bank is $5.00. What is Corry's average money holding? O a. $488.00 O b. $2,560.74 O c. $5,000.00O O d. $16.00 O Type here to search 24Cash: $104.25 billion Checking deposits: $157.4 billion Saving accounts: $270.5 billion Small denomination time deposits: $20.3 billion Bank reserves held at the Fed: $33.0 billion Suppose that in a certain economy, the above are the only forms of money. How much M2 money is there? O a. $565.15 billion O b. $282.15 billion O c. $427.90 billion O d. $303.50 billion O e. $137.25 billion O f. $552.45 billion
