What is...?
What does reserve mean?
Money put to the side for something else.
The central bank of the United States
The Federal Government Bank
Whats one (or both) ways the Fed changes the money supply?
Tight or easy money policy
Easy money makes the interest...
Go lower
Give an example of when reserved money would be taken out:
...
What happens to the money supply when the reserve requirement is raised
It decreases
The number of Federal Reserve districts
12
Tight money makes the interest...
Go wayyyy up
What is the reserve requirement?
The reserve requirement is a specification of the amount of cash a bank must have in order to cover sudden withdrawals.
If the Federal Bank raises the reserve requirement, what would happen to the money?
It would lose its value
Where are required reserves held?
Member bank vault or nearest Fed bank
Less money given to member banks causes...
Higher interest rates
The buying and selling of government securities by the Fed:
Open-market operations
The central control of the money supply by the Fed
Monetary policy
Fun bonus question!!
What is Mrs Marshall's fav color?
Blue
Higher money given to member banks...
Lower interest rates