Look at these Assets...
That's Going to Cost You
Here Comes The
Money!
Money For Nothing...
Money, Money, Money
Fed Up or Down?
The Loan Ranger
100
Giving up the change to earn money through interest (by holding cash)
What is opportunity cost (of holding cash)?
100
Nominal - Inflation =
What is the real interest rate? (Fisher equation)
100
This aggregate includes total amount of currency in circulation or on reserve by commercial banks.
What is the monetary base?
100
The United States' Central bank
What is the Federal Reserve?
100
Reserves, Excess Reserves, and Loans are on this side of the bank balance sheet
What are assets to banks (on a bank balance sheet)
100
the Y axis in the money market
What is the nominal interest rate?
100
The type of monetary policy that is used to correct a recessionary gap
What is expansionary monetary policy?
100
a hypothetical market for the money that is able to be borrowed including the market for bonds, stocks, and personal loans
What is the Loanable Funds Market?
200
The measure of how fast an asset can be turned into cash
What is liquidity?
200
These folks benefit if inflation turns out higher than borrowers originally expected.
Who are Borrowers?
200
This aggregate includes demand deposits, currency in circulation, and savings accounts.
What is M1?
200
Minimum amount of cash that a bank MUST hold
What are reserve requirements /what is the required reserve rate?
200
Demand Deposits are on this side of the bank balance sheet
What are liabilities (on a bank balance sheet)
200
This happens when the Federal Reserve purchases government bonds from commercial banks.
What is Bank reserves increase and the money supply can expand?
200
The type of monetary policy used to correct an expansionary gap
What is contractionary monetary policy?
200
If the Fed introduces a policy to reduce inflation this will likely increase.
What are interest rates?
300
Examples include crypto, real-estate, gold/silver and art
What are examples of least liquid assets
300
This is the real inflation rate when banks charge 5% interest on all loans and the expected inflation rate is 2%.
What is 3%?
300
This aggregate includes money in circulation, demand deposits, savings accounts, small denomination time deposits and retail money market funds.
What is M2?
300
buying or selling government debt (though bonds)
what are open market operations
300
Demand Deposits / Reserves =
What is the reserve requirement (rate)
300
If the economy is experiencing demand-pull inflation, the Fed uses this monetary policy.
What is contractionary monetary policy?
300
Name one monetary policy action the Fed could take to encourage borrowing and spending during a recession.
What is Lower administered interest rates, decrease the discount rate, or purchase government bonds (depending on the banking system).
300
When a country becomes politically unstable this becomes difficult.
What is borrowing?
400
The entity who sees a car loan as an asset.
Who is the bank/lender?
400
This is the actual rate of return when the bond with a 6% interest rate is met with 5% actual inflation rate.
What is 1% (rate of return)?
400
If you move $500 from your checking account to purchase a CD, _______ is unchanged while _______ decreases.
(What is/are) M2 and M1 respectively?
400
This the interest rate that the Federal Reserve pays when in an ample reserve system.
What is the administered rate?
400
This function describes the way banks create money from a single deposit
What is the money multiplier?
400
Increases in the supply of money assuming money demand stays constant causes this to occur.
What is the nominal interest rate decreases?
400
The expansionary monetary policy in a limited reserve framework as a result of less money required to be in reserves.
What is the impact of a reduction in reserve rate?
400
The leftward shift of the demand curve when people have less money and are not as inclined to take on big purchases
What is the impact of a recession (on the Loanable funds market)?
500
Name the three primary functions of money.
What is a Medium of exchange, unit of account, and store of value?
500
The new nominal interest rate when Vern has a fixed interest CD with a nominal interest rate of 7% with no expected inflation. If inflation is now expected to be 3%
What is 7%
500
? = $210 billion
What is the monetary Base?
500
This man is the current Chair of the Federal Reserve.
Who is Kevin Warsh?
500
1/rr
What is the money multiplier formula
500
If the government increases spending and does not increase taxation this happens.
What is nominal interest increases?
500
The Expansionary monetary policy that occurs in an ample reserves system.
What is a decrease in administered interest rates/ policy rate?
500
The rightward shift of the supply curve when there is more money entering the market to work with
What is the effect of positive inflow (net capital inflow on the loanable funds market)?