Money and Banking_Assignment 4 11_aug wed(2)

Money and Banking_Assignment 4 11_aug wed(2) - the partial...

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Money and Banking Summer 2010 Economics 220:301 Section H6 July 12 th - August 18 th Monday & Wednesday 6pm - 9:40pm 202 Scott Hall, College Ave Instructor: Georgia Bush Assignment 4 Draw dynamic diagrams of the market for Reserves including the following elements: the supply curve, the demand curve, interest rate paid by the Fed on excess reserves, interest rate received by the Fed on discount loans, the partial equilibrium Fed Funds rate. Be sure to label the vertical and horizontal axes, and clearly mark the pre-action partial equilibrium Fed Funds rate, and the post- action partial equilibrium Fed Funds rate. Draw all possible cases (ie change in
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Unformatted text preview: the partial equilibrium fed funds rate, or no change). 1) Before and after open market operations: a) purchase of government securities b) sale of government securities 2) Before and after a change in the reserve requirement a) increase in the required reserve ratio b) decrease in the required reserve ratio 3) Before and after a change in the Discount Rate a) increase in the discount rate b) decrease in the discount rate 4) Compare and contrast the following 3 monetary policy strategies:-Monetary Targeting-Inflation Targeting-Implicit Nominal Anchor Please turn in the diagrams and a printout of your essay in class Monday August 16th....
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This note was uploaded on 02/08/2011 for the course ECONOMICS 201 taught by Professor Bush during the Summer '10 term at Rutgers.

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