History of Banking Notes

Ch. 16 Exam and Notebook check today!

Chapter 16 Review
Pp. 436-437  #1-7, 9-17

Test on Tuesday and Notebook Check

1. 16.1 Notes
2. 16.2 Notes
3. Federal Reserve Functions Worksheet
4. Monetary Policy Worksheet
5. Ch. 16 Review

We discussed Tight vs Easy Money Policy, Inside and Outside Lags

Monetary Policy Worksheet

1.If you deposit $1,000 of borrowed money in a bank checking account, by how much do you increase the money supply?

2. Why does the Federal Reserve establish a required reserve ratio?

3. What three tools could the Federal Reserve use to adjust the money supply?

4. What two effects, leading to an increased money supply, could reducing the RRR have?

5. How do banks respond to a lowered discount rate?

6.  How does a raised discount rate affect bank loans and the money supply?

7.  How does the Fed’s sale of bonds reduce the money supply?

8.  Which of its monetary policy tools does the Federal Reserve use most often?

Chapter 16 Notes

Turned notebooks in and took Tax exam