Sort the following tools into increasing and decreasing the money supply.
Influence a Decrease in the FFR
Increase the RR
Decrease the DR
(FED) Sell Bonds
(FED) Buy Bonds
Decrease the RR
Increase the DR
Influence an Increase in the FFR
Increase the Money Supply
Decrease the Money Supply
Sort the following into expansionary and contractionary monetary policy.
Influence a Decrease in the FFR
(FED) Less Buying OMOs
Increase the RR
Decrease the RR
Increase the DR
(FED) More Buying OMOs
Influence an Increase in the FFR
Decrease the DR
Expansionary Monetary Policy
Contractionary Monetary Policy
Sort into the appropriate category
The Fed does more purchasing OMOs
Qd of Money > Qs of Money
Credit cards increase their average percentage rates (APRs)
The economy is booming and more households are finding employment
Banks raise ATM fees
Nominal Interest Rates Rise
The Fed lowers the reserve requirement.
Qd of Money < Qs of Money
Nominal Interest Rates Fall
The Fed increases the discount rate
The Fed influences an increase in the Federal Funds Rate.
Deflation hits the US economy
Supply of Money Increases
Supply of Money Decreases
Demand of Money Increases
Demand of Money Decreases
Shortage of Money
Surplus of Money