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What best explains why raising the discount rate affects the money supply?
Wiki User
∙ 8y ago
When the discount rate is high, banks keep more reserves on hand to avoid paying a lot to borrow from the Fed... Apex :)
When the discount rate is high, banks keep more reserves on hand to avoid paying a lot to borrow from the Fed.
Wiki User
∙ 8y ago
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How does raising the discount rate affect the money supply?
Decreases the money supply
What is economic parameter?
An economic parameter is a structural model. It usually explains how one thing affects another, such how supply affects demand.
What best explains why raising the required reserve ratio results in a decrease in the money supply?
When the required reserve ratio is high, must loan out a smaller portion of their reserves, resulting in fewer loans.
What is the ultimate impact on the money supply of an increase in the discount rate?
The increase in the discount rate will cause the money supply to reduce in growth
Which of the following best explains why raising the required reserve ratio results in a decrease in the money supply?
When the required reserve ratio is high, banks must loan out a smaller portion of their reserves, resulting in fewer loans.
How does raising the discount rate affect the money supply?
Decreases the money supply
What is economic parameter?
An economic parameter is a structural model. It usually explains how one thing affects another, such how supply affects demand.
What best explains why raising the required reserve ratio results in a decrease in the money supply?
When the required reserve ratio is high, must loan out a smaller portion of their reserves, resulting in fewer loans.
What is the ultimate impact on the money supply of an increase in the discount rate?
The increase in the discount rate will cause the money supply to reduce in growth
Is there a discount office supply store in evansville in.?
Yes, their are many discount office supply stores around Evansville, you could try your local staples business depot if you cannot find any other discount office supply stores.
Which of the following best explains why raising the required reserve ratio results in a decrease in the money supply?
When the required reserve ratio is high, banks must loan out a smaller portion of their reserves, resulting in fewer loans.
Does tractor supply give senior discount?
no no no
Which type of policy is controlled by the Board of Governors of the Federal Reserve?
Well, if by "the federal reserve", you mean the federal reserve bank, then there are two types of policies. These are expansionary and contractionary monetary policies. In times of recession, The FED uses expansionary policies such as increasing the money supply by buying bonds, lowering the discount rate, and lowering reserve requirements.In times of over expansion, The FED uses contractionary policies such as decreasing the money supply by selling bonds, raising the discount rate, and raising reserve requirements.
What affects gas prices?
Supply and demand.
Would cause a decrease in the supply of money?
raising of interest rates
Can you give me a sentence for cattle raising?
Cattle raising is important to the cattle industry because it keeps a constant supply of calves that are used for beef.
Are there any art supply stores that sell their products at a discount or wholesale price?
Micheal offers a frequent shopper discount program on their products. However you should try online for wholesale art supply companies.
