The Federal Funds Market is actually monitored and manipulated by the Federal Reserve, but individual investors can enter the market and borrow funds if desired. True or False

Q: The Federal Reserve could reduce the money supply by    selling government bonds in the open market…

A: Central banks use several methods, called monetary policy, to increase or decrease the amount of…

Q: During this COVID‐19 pandemic, the South African Reserve Bank (SARB) plays a crucial role in…

A: Due to covid 19, many countries are affected globally all country's central banks have taken the…

Q: Overnight loans issued by the Federal Reserve to commercial banks are known as   A. Negotiable…

A: The overnight loans issued by the Federal Reserve to commercial banks are known as Federal Funds.…

Q: The sale of government bonds by the Federal Reserve Banks to commercial banks will ______.

A: By selling government bonds within the open market, the Federal Reserve System banks reduce full…

Q: Banks are classified into different categories for efficient regulation of the central monetary…

A: Banks are classified into different categories in order to meet different demands such as business…

Q: how does a general increase in uncertainty as a result of a failure of major financial institution…

A: Adverse selection refers to the situation where there is a lack of information existing in the…

Q: explain and demonstrate graphically the effect of an open market sale on the federal funds rate.

A: Open market sales of government securities to decrease the money supply that decreases the amount of…

Q: How do monetary financial institutions create liquidity, pool risk, lower the cost of borrowing, and…

A: The monetary financial institutions such as banks, insurance companies, mutual funds, non-banking…

Q: Assume that the US debt is increasing rapidly at a time when the US economy is struggling.  If…

A: There are various factors in the loanable funds market that are responsible for a change in interest…

Q: One thing all expansionary monetary policies have in common is that they all include increasing…

A: Expansionary monetary policy means using monetary policy tools in such a manner that it increases…

Q: It is the responsibility of the U.S. Department of Commerce to maintain stability in the financial…

A: The responsibility of the US Department of Commerce includes the maintaining of international trade…

Q: advantages and disadvantages of quantitative easing

A:

Q: As the interest rates decline, the amount of money the public holds rise. True or False

A: Interest rate play an important role in the people's decision to hold money.

Q: Prior to the Great Recession, the Federal Reserve followed a restricted reserves policy.  True…

A: The Great Recession: The great recession which started in Dec 2007 and lasted for almost 2 years was…

Q: Bruce the Bank Manager can reduce interest rate risk by_____ the duration of the bank's assets to…

A: Any commercial bank holds rate-sensitive assets and liabilities and fixed-rate assets and…

Q: If the Federal reserve decides to reduce the money supply through open market operations, then the…

A: If the Federal reserve decides to reduce the money supply through open market operations, it will do…

Q: Smaller firms tend to rely more on financial intermediaries to obtain funds externally due to high…

A: The transaction costs and information costs are add on cost which raises the cost of funds to…

Q: Each of the seven governors of the Federal Reserve Board is appointed by the president and confirmed…

A: Federal reserve is the central banking system created in 1913 in U.S.A. The purpose for creating it…

Q: Suppose that you deposit $8,000 in your bank and the required reserve ratio is 15 percent. The…

A:

Q: Quantitative easing is an open-market operation where the Central Bank (CB) buys longer-term riskier…

A: In a market, Central Bank uses different types of monetary policies to influence the supply of money…

Q: What will happen to Vladimir Putin after the war with Ukraine? What kind of consequences will he and…

A: Throughout 2021 and 2022, Russian military development on the boundary of Ukraine has raised…

Q: Financial Sector Reforms in Ghana from 2007 to 2020 Impact on the reforms of the economy

A: Empirical data suggest that the economic growth in the African nation of Ghana has been an…

Q: Detail and critically assess the economics of the reserve capacity mecha

A: The mechanism of the reserve capacity session of electricity gives framework on the wholesale market…

Q: The Federal Open Market Committee consists of: Group of answer choices 7 members nominated by the…

A: Federal Open Market Committee is the committee which operates the money supply of the economy by…

Q: If the Fed sells government securities to the general public in the open market, the _____.

A: The monetary policy refers to the central bank policy of money supply and interest rate which…

Q: Following the Great Recession, the Federal Reserve adopted a restrictive reserve policy.   true…

A: Following the Great Recession, the Federal Reserve adopted a restrictive reserve policy. This…

Q: Smaller firms tend to rely more on financial intermediaries to obtain funds externally due to high…

A: Financial intermediaries are the people that fulfil the fund requirement of the businesses.

Q: The following are the common characteristics of financial intermediaries, except: * a. Providers of…

A: A financial intermediary is an entity acting as a bridge between two parties involved in a financial…

Q: Access to funds, domestically and  internationally, is made easier with the presence of financial…

A: Access to funds explains the availability and affordability of the monetary resources to make an…

Q: Explain the role of the banking system in the effective implementation of the monetary policy

A: The central bank controls the money supply and interest rates. By controlling these instruments, the…

Q: “The Federal Open Market Committee today voted to raise its target for the federal funds rate by 25…

A: Monetary and fiscal policies are both employed to control economic activity over time. Monetary…

Q: Identify and discuss varying potential risks that are likely to arise on commercial banks side as a…

A: When the economy is in a "boom" phase with high inflation, it becomes necessary for the nation to…

Q: Why does stock market go down, when treasury yields go up?

A: This is a really important relationship and causal effect. The yield on bonds is generally used…

Q: Which of the following is TRUE about interest rates offered by financial Intermediaries? * A.The…

A: When talking about financial intermediaries, they are the institutions that provide financial…

Q: Discuss the implication of shadow banking as a source of raising finance in developing economies.

A: Credit creation in the unorganized sector i.e. non-regulated without oversight via financial…

Q: security borrowing agreement takes place at T+1 followed by a sell order/match of the security at…

A: the borrower becomes the official owner of security at T+3 and the at the time of sale order, the…

Q: The increase in excess reserves that occurred as a result of the mortgage debt crisis

A: We have to find when increase in excess reserves that occurred as a result of the mortgage debt…

Q: Which of the following best defines a financial intermediary?

A: Financial intermediary: The financial intermediary is an institution, which act as a mediator of the…

Q: Suppose the Federal Reserve decided to sell $35 billion worth of government securities in the open…

A: Money multiplier:Money multiplier can be calculated as follows:

Q: If the Federal Reserve wants to reduce interest rates and increase the velocity of money, it can…

A: Buying and selling US government securities is an open market operation.

Q: Which of the following is TRUE about financial regulations? * A. Financial regulations makes the…

A: Financial Institutions are defined as those companies which deal in financial and monetary…

Q: Why do managers of financial institutions care so much about the activities of the Federal Reserve…

A: The Federal Reserve System, frequently alluded to as the Federal Reserve or basically "the Fed," is…

Q: The following are correct about financial intermediaries, EXCEPT? * A. Financial intermediaries are…

A: In the financial markets, financial intermediaries are the firms or people, who act as the…