In the Market for Reserves,if the Federal Funds Rate Is

question 26

Multiple Choice

In the market for reserves,if the federal funds rate is between the discount rate and the interest rate paid on excess reserves,a decline in the reserve requirement ________ the demand of reserves,________ the federal funds rate,everything else held constant.

• A)decreases;lowering
• B)increases;lowering
• C)increases;raising
• D)decreases;raising

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Definitions:

March of Dimes

An American nonprofit organization that works to improve the health of mothers and babies by preventing birth defects, premature birth, and infant mortality.

Donation

The act of giving money, goods, or time to support a cause, individual, or organization without expecting anything in return.

Central Route

A method of persuasion that relies on the audience's careful and rational evaluation of the arguments presented in a communication.

Surface Cues

External or superficial features of an object or situation that can influence perception and decision-making.