The fed decreases the money supply

Assignment Help Microeconomics
Reference no: EM13697352

Use the supply and demand for Reserves to show what happens to the Federal Funds Rate when The Fed decreases the money supply. Assume that ior < iff < id. What happened to the quantity of borrowed reserves as a result of the action taken by The Fed?

Reference no: EM13697352

Questions Cloud

Condition required for the practice of price discrimination : Which of the following is a condition required for the practice of price discrimination?
Example of the prisoners dilemma : Which of the following is an example of the prisoner's dilemma?
What is the value of the marginal propensity to consume : Consider a simple economy in which investment is constant and equal to $100 billion. There is no government or foreign sector, and the price level is constant. What is the value of the marginal propensity to consume?
Impact the money supply : Explain how the following would impact the money supply: a. People decide to hold more cash b. Banks hold more excess reserves c. The Fed decreases the required reserve rate d. The Fed increases the discount rate
The fed decreases the money supply : Use the supply and demand for Reserves to show what happens to the Federal Funds Rate when The Fed decreases the money supply. Assume that ior
Deposits in excess reserves : Suppose the Fed purchases $250 million worth of securities from banks. If the currency/deposit ratio is 0.6 and The Fed requires banks to hold 12% of their deposits in reserves, how much money will be created through The Fed’s action if banks hold 2%..
Appropriate federal funds rate according to the taylor rule : If the current inflation rate is 3.3%, potential gdp is $16.9 trillion, and actual GDP is $15.7 trillion, what is the appropriate federal funds rate according to the Taylor Rule?
Represents the weekly demand that a local theater faces : The following equation represents the weekly demand that a local theater faces. Qd = 2000 - 25 P + 2 A, where P represents price and A is the number of weekly advertisements. Presently the theater advertises 125 times per week.
What are the three traditional tools of monetary policy : What are the three traditional tools of Monetary Policy? Describe the mechanics of how each change the supply of money in the economy.

Reviews

Write a Review

Microeconomics Questions & Answers

  Why is there a cluster of prices rather than a single

Why does a prospective monopolistic competitor find it relatively easy to start production in the long run?

  What effect would the addition of population growth have

How would population growth effect the dynamically efficient allocation, given the model in question 2 the second period has a higher demand for the depletable resource. What effect would the addition of population growth have on the efficient all..

  What is the current minimum wage in the u.s

What is the current minimum wage in the U.S and what is the minimum wage for workers who receive tips

  Describe whether or not you can refute the claim base only

a firm has the choice of the following investmentsinvestment a costs 5000 today pays a total of 4000 next year and 1700

  Decrease in employment for workers

Increasing the minimum wage will result in a decrease in employment for workers who now earn less than the new minimum wage

  Identifying effective novel reward behaviors

Discuss and explain how coaching rather than managing people can enhance a leader's understanding of RQ and therefore provide a better understanding of their followers.

  Use your own words to explain the idea of equilibrium in

use your own words to explain the idea of equilibrium in the income-expenditure model. as part of your answer explain

  An individual competitive firm’s short-run supply curve

An individual competitive firm’s short-run supply curve is the portion of its marginal cost curve that equals or rises above the average variable cost. Describe why

  Production function exhibit constant

Production function exhibit constant, increasing, or decreasing returns to scale?

  Clothes that is passed on to the market in the form of lower

Which of the following events would cause a movement along the demand curve for U.S. produced clothing, and which would cause a shift in the demand curve?

  1 examine the history of immigration to the united states

1 examine the history of immigration to the united states from the cape verde islands. how did the immigration to the

  The budget surpluses-series of budget deficits

Why did the budget surpluses in 2000 and 2001 give to a series of budget deficits beginning in 2002? Why did those deficits increase substantially beginning in 2008?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd