Real basic money question

Do any of the following qualify as items of money, or preform any of the functions of money (medium of exchange, unit of account, or store value) partially or completely? Antique clock plastic sheets used to make Visa cards coins in the Fed museum Government bonds

Reserves

Do reserves include all assets? REserves at Fed Cash in ATMs Government Securities Loans Total deposits...liabilities?

Loans

How much will the bank loan given: 25 in reserves at the Fed 15 in ATMs 60 in Government securites 100 in loans 90 in demand deposits 110 in savings deposits and the reserve ratio on deposits is 5%

Currency

What is currency in circulation mean? And why is it considered to be apart of the monetary base.

Macroeconomics Review Questions

Suppose that interest rates are 6 percent in the economy and a safe bond promises to pay $3 per year in interest forever. What do you think the price of the bond will be? Why? Suppose that in this economy interest rates suddenly fall to 3 percent. What will happen to the price of the bond that pays $3 per year? (See attachm ...continues

money creation and control

A bank has: 25 in reserves at the Fed 15 in AtM cash 60 in Gov't securities 100 in Loans 90 in demand deposits 110 in savings deposits required reserve ratio is 5% so if there is no currency drain and if all the funds loaned remained deposited in the First Student Bank, what is the quanity of loans and total de ...continues

Factors that create a drag on the economy

From The Wall Street Journal, Thursday, December 2, 2004: "Janet Yellen, president of the Federal Reserve Bank of San Francisco, said in a speech yesterday at Arizona State University that sustained high oil prices, business caution, the growing trade deficit, consumers' need to rebuild savings and the waning boost from tax cu ...continues

Why globalization should increase the share of national income in US

a. Explain why, as discussed by Thurow (Lester Thurow in Fortune Favours the Bold), globalization should increase the share of national income going to capital in the United States. Be clear about the economic principle involved. Ignore Thurow if you have not read his book. Just answer the part on globalization.

Calculate Real GDP

Quantities Produced Quantities Produced Prices Prices CDs Tennis Racquets CDs Tennis racquets Year 2004 100 200 20 110 Year 2005 120 210 22 120 1. Calculate real GDP for 2004 and 2005 using 2004 prices. By what percent did real GDP grow? 2. Calculate the value of the price ...continues

Lux Car is a car rental company

1. Lux Car is a car rental company in the city. It is trying out a new return policy that allows customers to return the cards to the most convenient location to improve customer service. The implication is that the company has to constantly move card around the city to maintain required levels of vehicle availability. The suppl ...continues