Most at risk are 100 Treasury funds, which can’t shift. Treasury securities would be most at risk in a debt ceiling crisis. Purchases of government bonds from banks. Money market funds whose portfolios are entirely made up of U.S. By changing the interest rate paid in reverse repurchase agreements, in addition to the rate paid on reserves, the Fed is able to better control the federal funds rate. Which of the following actions by the Fed would cause the money supply to increase? A. raise interest rates and restrict the availability of bank credit. The purpose of a restrictive monetary policy is to: A. lowers both the interest rate and aggregate demand. lowers the interest rate and increases aggregate demand. increases both the interest rate and aggregate demand. increases the interest rate and decreases aggregate demand. D sell government securities, raise reserve requirements, lower the discount rate, and increase the interest - paid on reserves held at the Fed banks. Csell government securities, lower reserve requirements, lower the discount rate, and increase the interest paid on reserves held at the Fed banks. B buy government securities, raise reserve requirements, raise the discount rate, and reduce the amount of interest paid on reserves held at the Fed banks. If the Federal Reserve authorities were attempting to reduce demand-pull inflation, the proper policies would be to: A sell government securities, raise reserve requirements, raise the discount rate, and increase the interest paid on reserves held at the Fed banks. A tax increase and an increase in the interest rate. Officials see as many as three more hikes in 2023 and in 2024, bringing the Fed's benchmark borrowing rate to a range between 1.75 and 2, from its current 0 to 0.25. Figure 13.6 Key Interest Rates, 20022011 charts ten-year fluctuations in the discount rate, federal funds rate, and prime rate the rate that banks charge their best customers. A reduction in government expenditures and a decline in the money supply. A tax reduction and an increase in the money supply. A tax increase and an increase in the money supply. Assuming government wishes to either increase or decrease the level of aggregate demand, which of the following pairs are not consistent policy measures? A. D An increase in the money supply will lower the interest rate, increase investment spending, and increase aggregate demand and GDP. C An increase in the money supply will raise the interest rate, decrease investment spending and decrease aggregate demand and GDP. Which of the following best describes the cause-effect chain of an expansionary monetary policy? A A decrease in the money supply will lower the interest rate, increase investment spending and increase aggregate demand and GDP B A decrease in the money supply will raise the interest rate, decrease investment spending and decrease sell government securities in the open market. Further out, our 2026 and long-run projection for the fed-funds rate. buy government securities in the open market. We project a year-end 2023 federal-funds rate of 4.75, falling to about 2.00 by the end of 2024. If the Fed wants to lower the federal funds rate, it should: A increase the discount rate.
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