This topic contains a solution. Click here to go to the answer

Author Question: Malthus was too pessimistic because he did not foresee the effects of A) ever increasing amounts ... (Read 77 times)

Themember4

  • Hero Member
  • *****
  • Posts: 538
Malthus was too pessimistic because he did not foresee the effects of
 
  A) ever increasing amounts of land for cultivation.
  B) increases in the capital stock and the effects of such increases on production.
  C) improved nutrition and health care.
  D) improved family planning practices.

Question 2

Targeting the federal funds rate allows the Fed some ability to control bank reserves and thus the money supply. Explain how each of the following tools allows the Fed to fine-tune its control of bank reserves.
 
  a. Conducting open market operations
  b. Changing the discount rate
  c. The ability to pay interest on reserves
  d. The Term Deposit Facility



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

ecox1012

  • Sr. Member
  • ****
  • Posts: 344
Answer to Question 1

B

Answer to Question 2

a. When the Fed conducts an open market purchase, it purchases Treasury securities in the open market, and the money received by the seller of the securities becomes reserves in the banking system. The increase in bank reserves decreases the federal funds rate. An open market sale reduces bank reserves and increases the federal funds rate.
b. When the Fed raises the discount rate, banks must pay more to borrow money from the Fed. This will decrease the number of loans made by the Fed, decreasing the monetary base. All else equal, this will reduce the money supply. If the Fed lowers the discount rate, more loans will be made, increasing bank reserves and the monetary base, and all else equal, this will increase the money supply.
c. By increasing the interest rate on reserves, the Fed can increase the level of reserves banks are willing to hold, thereby restraining bank lending and slowing the growth in the money supply. Decreasing the interest rate will increase bank lending and increase the money supply.
d. By increasing the interest rate on term deposits, the Fed can decrease the level of reserves banks have available to make loans, thereby restraining bank lending and slowing the growth in the money supply. Decreasing the interest rate will increase bank lending and increase the money supply.




Themember4

  • Member
  • Posts: 538
Reply 2 on: Jun 30, 2018
Great answer, keep it coming :)


jordangronback

  • Member
  • Posts: 339
Reply 3 on: Yesterday
Gracias!

 

Did you know?

Your chance of developing a kidney stone is 1 in 10. In recent years, approximately 3.7 million people in the United States were diagnosed with a kidney disease.

Did you know?

Symptoms of kidney problems include a loss of appetite, back pain (which may be sudden and intense), chills, abdominal pain, fluid retention, nausea, the urge to urinate, vomiting, and fever.

Did you know?

The human body's pharmacokinetics are quite varied. Our hair holds onto drugs longer than our urine, blood, or saliva. For example, alcohol can be detected in the hair for up to 90 days after it was consumed. The same is true for marijuana, cocaine, ecstasy, heroin, methamphetamine, and nicotine.

Did you know?

About 3% of all pregnant women will give birth to twins, which is an increase in rate of nearly 60% since the early 1980s.

Did you know?

Critical care patients are twice as likely to receive the wrong medication. Of these errors, 20% are life-threatening, and 42% require additional life-sustaining treatments.

For a complete list of videos, visit our video library