Computing banking required reserves

Assignment Help Microeconomics
Reference no: EM1374496

Assume that the banking system's nonborrowed reserves total $48.3 billion, with total legal reserves standing at $51.2 billion. What must borrowed reserves be? This morning the Federal Reserve decided to undertake the sale of $500 million in government securities through open market operations. What will the new level of nonborrowed reserves? If interest rates do not change, what will be the new level of total reserves? What must you assume to make this calculation? If interest rates do change, which way are they likely to move?

Reference no: EM1374496

Questions Cloud

Explain the macroeconomic and microeconomic concepts : Microeconomics is considered to be the study of scarce resources. Here, customers must make allocation decisions. These 3-basic trade offs include which goods or services are to be manufactured,
Perfect competition and monopolistic competition : The main difference between perfect competition and monopolistic competition is, rices under an ideal cartel situation will be equal to
Explaination for rise in salaries : In recent years, scores in baseball have constantly increased. Most experts believe that this is due to expansion of new teams into the league.
Determine the slope of the lm curve : Define the factor that estimate the slope of the LM curve and whether an increase in theses factor will make the curve flatter or steeper.
Computing banking required reserves : Assume that the banking system's nonborrowed reserves total $48.3 billion, with total legal reserves standing at $51.2 billion. What must lent reserves be?
Generate a supply and demand function from a data table : Show how to generate a supply and demand function from a information table that includes the supply and demand information for two different price levels.
Calculate the premerger herfindahl-hirschman index : Suppose you are the manager in a market comprised of five companies, each of which has a 20% market share. In addition, each company has a strong financial position and is located within a 100-mile radius of its competitors.
Implementation of monetary policy and federal reserve : Determine what type of monetary policy has the Federal Reserve been using for the last year easy or expansionary, tight or contractionary, or neutral or non-involvement)?
Determine aggregate demand line : Assume a bank has $200,000 in deposits, a needed reserve ratio of 10%, and bank reserves of $50,000. Then the bank can make new loans in the amount of?

Reviews

Write a Review

Microeconomics Questions & Answers

  Determining two variables of price

The demand for new homes in the United States is often described as highly cyclical and very sensitive to housing prices and interest rates.

  Encouraging monopoly to social efficiency

Explain how this tax or subsidy would achieve the socially efficient level of output. Among the various interested parties - the monopoly firm, the monopoly's consumers, and other taxpayers - who would support the policy and who would oppose it?

  Supply and demand in the corn market

Describe how the market for corn would be influenced if ethanol, a corn derivative was used to fuel cars in US. How would market be influenced if a new technology caused corn farming to be more efficient?

  Elasticities and knowing nature of related good

Compute the price elasticity of demand using the point formula for Px = 20 and Py = 10. Determine whether demand is elastic, inelastic, or unit elastic with respect to its own price and whether Good Y is a substitute or a complement with respect t..

  Average cost-minimizing activity level

Compute output, marginal cost, average cost, price, and profit at the average cost-minimizing activity level. Compute these values at the profit-maximizing activity level.

  Determining monopoly output decision

Here is the information you require to answer the question. This information is taken from the graph. So you will require to draw the graph to answer the questions. The best level of output for monopolist in short run is 500 units and is given by p..

  Relationship between ap and mp

Explain the relationship between AP and MP. Be sure to use graphs to help support your answer. Calculate the MP and the AP for each worker

  Question about money multiplier

Suppose that the banking system is in reserve equilibrium. The Fed conducts an open market buy of Treasury securities in the value of $1 billion.

  Description of demand function

The general demand function for a good, Good A, is: Is Good A a normal good or an inferior good? How do we know exactly?

  Two part pricing strategy

You're the manager of monopoly. A typical consumer's inverse demand function for your firm's product is P=100-2Q and your cost function is C(Q)=20Q. Find out the optimal two part pricing strategy.

  Describing law of diminishing marginal productivity

What is the law of diminishing marginal productivity? How does it differ from average productivity?

  Determine effect on optimal price

The United States cigarette industry has negotiated with Congress and government agencies to settle liability claims against it. Under the proposed settlement, cigarette firms will make fixed yearly payments to government based on their historic mark..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd