Econ 203 Exam 3 questions with correct answers

The Federal Reserve CORRECT ANSWER in charge of monetary policy in U.S., adjusts the money supply to help achieve its monetary policy goals Monetary CORRECT ANSWER increasing and decreasing amount of money in the economy Monetary Policy Goals CORRECT ANSWER e prices (low inflation) and maximum employment 2. stable economic growth 3. stable financial system The Fed's Monetary Policy Tools CORRECT ANSWER open market operations, interest rates on reserves, required reserve ratio, discount rate Fractional Reserve Banking CORRECT ANSWER a system in which banks must keep a fraction of their deposits as reserves and can lend the rest Money Supply CORRECT ANSWER the quantity of money available in the economy Reserves CORRECT ANSWER deposits that banks have received but have not loaned out Total Reserves= CORRECT ANSWER Required Reserves + Excess Reserves Required Reserves= CORRECT ANSWER Deposits x