Please verify and check my answers. I need help with #27,30,31, and 33. Thanks.
ID: 1114638 • Letter: P
Question
Please verify and check my answers. I need help with #27,30,31, and 33. Thanks.
26. Which of the following has a four-year term? a the members of the Board of Govermors · d. All of the above are correct. the Chair of the Board of Governors the members of the FOMC ,27. when the Fed conducts open market purchases, bank reserves a. increase and banks can increase lending . b. increase and banks must decrease lending. c. d. decrease and banks can increase lending. decrease and banks must decrease lending. -28. The Federal Reserve does all except which of the following? a. control the supply of money control the value of money make loans to individuals regulate the banking system d. 29. If the publie decides to hold more currency and fewer deposits in banks, bank reserves decrease and the money supply eventually decreases. decrease but the money supply does not change. c. increase and the money supply eventually increases. d. increase but the money supply does not change. 30. Suppose that the reserve ratio is 10 percent and that a bank has $2,000 in deposits. Its reserves are a. $20 b. $200 c. $1,880. d. $1,800 31. On a bank's T-account, a. both deposits and reserves are assets b. both deposits and reserves are liabilities. c. deposits are assets, reserves are liabilities. d. reserves are assets, deposits are liabilities. Which of the following does the Federal Reserve not do? a. b. 32. conduct monetary policy act as a lender of last resort convert Federal Reserve Notes into gold d. serve as a bank regulator 33. When the Fed decreases the discount rate, banks will a. borrow more from the Fed and lend more to the public. The money supply increases. b. borrow more from the Fed and lend less to the public. The money supply decreases. borrow less from the Fed and lend more to the public. The money supply increases. borrow less from the Fed and lend less to the public. The money supply decreases.Explanation / Answer
27. The right option is a.
Explanation: When the Federal Reserve conducts open market purchases, it deposits payment for the purchase into the bank accounts of the entities selling the bonds. These deposits now become part of the cash held by commercial banks at the Fed. This increases the bank reserve available with commercial banks to lend.