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If the federal reserve sells 40000 in treasury bonds to a bank at 5 interest what is the immedate effect on the money suppy?
When the Federal Reserve sells $40,000 in Treasury bonds to a bank, it decreases the money supply by that amount. The bank pays for the bonds using its reserves, which reduces the reserves available for lending. Consequently, this action tightens the money supply, as there is less money available in the banking system for loans and other transactions. The interest rate of 5% is relevant for future borrowing but does not directly affect the immediate change in the money supply from this transaction.
What is the most likely effect of the Federal Reserve lowering the discount rate on overnight loans?
The most likely effect of the Federal Reserve lowering the discount rate on overnight loans would be an increase in the money supply. an increase in the money supply
What is share money deposit?
Profit reinvested i the company by its share holders is called share deposit money
How long does it take for deposited money to post to your account?
In most cases it'll be 4-5 working days for a cheque deposit. Obviously, cash would be immediate.
Can I deposit a money order in my bank?
Yes, you can deposit a money order in your bank.
If the federal reserve sells 40 000 in treasury bonds to a bank with 5 interest what is the immediate effect on the money supply?
If the federal reserve sells $40,000 in treasury bonds to a bank with 5% interest the immediate effect on the money supply is an decrease of $40,000.
If the federal reserve sells 50000 in Treasury bonds to bank at 6 interest what is the immediate effect on the money supply?
it is decreased by 50000
Will the money supply increase if people deposit their cash into a demand deposit account?
yes
If the Federal Reserve sells 50000 in Treasury bonds to a bank at 6 interest what is the immediate effect on the money supply?
It Is b
If there is an excess supply of money?
deposit more into interest-bearing accounts, and the interest rate will fall.
What are the factor that effect money supply?
Bank rate
What is an immediate annuity rate?
An immediate annuity is an annuity that begins making payments to you shortly after you deposit your money. The rate of interest you earn on this depends on age, payment options, and other factors.
Predict what will happen to the money supply if there is a sharp rise in the currency ratio?
The money supply falls. The rise in c means that there has been a shift from deposits which undergo multiple deposit expansion to currency which does not. Thus overall level of multiple expansion declines, and the money multiplier and money supply fall.
Why might the money supply not expand by the amount predicted by the deposit expansion multiplier?
The reserve requirement could change.
What describes how Lowering the required ratio increases the money supply?
Makes the deposit multiplier bigger. - Dustin SELU
What is the effect if the cause is congress printed more currency?
If Congress printed more currency, the immediate effect would be an increase in the money supply. This could lead to inflation as there would be more money chasing the same amount of goods and services. Additionally, it could potentially devalue the currency and erode purchasing power.
A long-run effect of increasing the money supply can be inflation?
true
