1) Which of the following is listed on the asset side of the Federal Reserve bal
ID: 1127168 • Letter: 1
Question
1) Which of the following is listed on the asset side of the Federal Reserve balance sheet? cash items in process of collection. a. b. deposits of the U.S. Treasury. c. Federal Reserve notes. d. All of the above. 2) If the required reserve ratio () is equal to 15 percent, the Depository Institutions hold 10 percent of transactions deposits as excess reserves (e), and the public desires to hold 5 cents for each dollar of transactions deposits (k), then the value of the money multiplier is equal to: A. (1-0.15-0.10 (0.05 +0.15)- 3.75 B. (1-0.15 (0.05+0.10)-5.67 C. (I +0.05y(0.05+0.15+0.10) 3.50 D. +0.15/(0.15 + 0.10) 4.60 3) The Monetary Base is made up of A. total reserves of the Depository Institutions (DIs) minus excess reserves. B. reserves of the DIs with the Fed + currency in circulation + gold certificates. C. Currency in circulation + reserves of the DIs with Fed D. Gold+ Currency in circulation+ Excess reserves of the DIs with the Fed. 4) The Federal Reserve System has complete control over a. the currency leakage ratio (k). b. the reserve of depository institutions with the Fed (R). c. the excess reserve ratio (e). d. the required reserve ratio (r). An increase in Treasury coins in the Fed's balance sheet will: a. increase the Monetary Base (MB) 5) b. decrease the MB. c. decrease the reserves of the Depository Institutions (R) with the Fed. d. increase R but decrease the MBExplanation / Answer
1. d. All of the above.
Cash items in process of collection, deposits of the US Treasury, and Federal Reserve notes are all parts of the assets of the Fed. Fed's other assets include Treasury Securities, Gold stock, debt securities, mortgage-backed securities, loans, etc.
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