Question

Please provide the answers.
Banks’ vault cash plus banks’ deposits at the Fed equals

a. the Fed’s capital stock.

b. discount loans.

c. reserves.           

d. required clearing balances.

2. An increase in the amount of interest paid on reserves would have what effect?

a. decreases the M2 money multiplier.

b. decreases the ratio of excess reserves to transaction accounts held by banks

c. increases the money supply for a given amount of monetary base.

d. increases the ratio of excess reserves to transaction accounts held by banks 

3. If the Federal Reserve purchases securities from member banks overnight because the Fed Funds rate has drifted away from the target, that is an example of what type of operation?

a. defensive

b. dynamic

c. primary

d. seasonal

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