chapter 15: Monetary Policy and Banking Regulation

According to the basic quantity equation of money, if price and output fall while velocity increases, then:

What is the name given to the macroeconomic equation MV = PQ?

If you were to survey central bankers from around the world and ask them what they believe the primary task of monetary policy should be, what would the most popular answer likely be?

Atlantic Bank is required to hold 10% of deposits as reserves. If the central bank increases the discount rate, how would Atlantic Bank respond?

If GDP is 3600 and the money supply is 300, what is the velocity?

If nominal GDP is 1800 and the money supply is 450, then what is velocity?

Regardless of the outcome in the long run, ______________________ is designed to stimulate the economy in the short run.

When a Central Bank makes a decision that will cause an increase in both the money supply and aggregate demand, it is:

If the economy is in recession with high unemployment and output below potential GDP, then __________________ would cause the economy to return to its potential GDP?

Which of the following is described as an innovative and nontraditional method used by the Federal Reserve to expand the quantity of money and credit during the Great Recession of 2007-2009?

Which of the following institutions oversees the safety and stability of the U.S. banking system?

The central bank uses a ____________________ monetary policy to offset business related economic contractions and expansions?

What term is used to describe the interest rate charged by the central bank when it makes loans to commercial banks?

When the central bank decides it will sell bonds using open market operations:

If a Central Bank decides it needs to decrease both the aggregate demand and the money supply, then it will:

If GDP is 2400 and the money supply is 600, then what is the velocity?

Which of the following institutions determines the quantity of money in the U.S. economy as its most important task?

When a Central Bank takes action to decrease the money supply and increase the interest rate, it is following:

_______________ will often cause monetary policy to be considered counterproductive because it makes it hard for the central bank to know when the policy will take effect?

A central bank that desires to reduce the quantity of money in the economy can:

When the Federal Reserve announces that it is implementing a new interest rate policy, it is actually targeting a change in the ____________________.

If the economy is at potential GDP and the Central Bank adopts an expansionary monetary policy that shifts aggregate demand to the right, in the long run, the Central Bank will __________________.

When the central bank decides to increase the discount rate, the:

If nominal GDP is 2700 and the money supply is 900, what is velocity?

Which of the following is considered to be a relatively weak tool of monetary policy?

Which of the following events would cause interest rates to increase?

A central bank that wants to increase the quantity of money in the economy will:

Which of the following terms is used to describe the proportion of deposits that banks are legally required to deposit with the central bank?

Which of the following is a traditional tool used by the Fed during recessions?

If the economy is at equilibrium as shown in the diagram above, then an expansionary monetary policy will: