-Explain how the Fed uses open market operations to reduce the money supply.

-Why do the Fed’s open market operations have a different effect on money supply than do transactions between two depository institutions?

-Explain how the Fed's monetary policy may indirectly affect the prices of equity securities.

Answers

Answer 1

The Fed uses open market operations as a tool to control the money supply in the economy. When the Fed wants to reduce the money supply, it sells government securities, such as Treasury bonds, in the open market. This means that the Fed sells these bonds to banks and other financial institutions, taking money out of circulation.

By selling bonds, the Fed decreases the amount of money available to banks and individuals. When banks buy these bonds, they use their reserves, which are a portion of their deposits held by the Fed. As a result, banks have less money to lend to individuals and businesses, reducing the overall money supply.

On the other hand, transactions between two depository institutions, like banks, do not directly affect the money supply. These transactions involve the transfer of funds from one bank to another, but they do not change the total amount of money in circulation. The money only changes hands between the banks, but the overall money supply remains the same.

The Fed's monetary policy can indirectly affect the prices of equity securities. When the Fed implements expansionary monetary policy, such as lowering interest rates or buying bonds, it stimulates economic activity and increases the money supply. This can lead to more investment in the stock market, driving up the prices of equity securities. Conversely, if the Fed implements contractionary monetary policy, it can reduce economic activity, resulting in lower stock prices.

In summary, the Fed uses open market operations to reduce the money supply by selling government securities, which reduces the amount of money available to banks and individuals. Transactions between banks do not directly impact the money supply. The Fed's monetary policy can indirectly affect the prices of equity securities through its impact on the overall economy.

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Related Questions

which of the following should be pracited among all co workers in the workplace
a.bullying
b.discrimination
c.stereotyping
d.tolerance

Answers

Answer:

c

Explanation:

Answer:

D. Tolerance

Explanation:

Because what, you souldnt do any of the others, dude, teachers sometimes

Think of a substantial product you regularly purchase, such as video games or jeans. If supply is high and
demand is low, what happens to the cost? How might that affect someone's income? Likewise, if supply is low
and demand is high, what happens to the product's cost? How might that affect someone's income?

Answers

Answer:

See below

Explanation:

1. When the supply is high, and demand is low, an item's cost will probably come down. High supply with low demand creates a surplus in the market. Seller will offer the lowest prices possible to woe buyers.

When an item's prices go down, buyers will spend less money buying the product. The buyer saves some money, which is equivalent to having more income than before.

2. With a low supply but high demand, prices tend to go up. There will be great competition for the few goods from the many buyers. As a result, suppliers will hike prices and make more profits.

An increase in prices forces buyers to spend more money to buy the same commodities. Their disposable income decrease, which is the same as having a reduced income

Based on the W-2 provided, Social Security tax withheld for Lily was ______ of wages and Medicare tax withheld was ______ of wages.

a. 1.3%, 5.5%
b. 6.2%, 1.45%
c. 10%, 10%
d. 28%, 39.8%

Thanks for any help I can get! I don't need an explanation as to how you got the answer. ​

Answers

Answer:

b. 6.2%, 1.45%

Explanation:

Social security and medicare are calculated as a percentage of the gross pay. For Lily, gross pay is $14,450.

For social security, 895.90 is deducted. As a percentage of her gross pay

895.90 will be.

=895.90/ 14,450 x 100

= 0.06193771 x 100

=6.2 %

For medicare, 209.5 has been deducted.  As a percentage of her gross pay, 209.5 is

=209.5/ 14,450 x 100

=0.01449827 x 100

=1.45%

The social security tax is the tax amount that is acquired from the earned income to fund the benefits of social security. It is the major part of the salary that carries the benefits for the person who earns it and contributes some part for the benefits of the government.

The correct answer is b. 6.2%, 1.45%

Social security and medicare are calculated as a percentage of the gross pay. For Lily, gross pay is $14,450.

For social security, 895.90 is deducted. As a percentage of her gross pay

895.90 will be.

[tex]=\frac{895.90}{14,450}\times 100= 0.06193771 \times 100=6.2 \%[/tex]

For medicare, 209.5 has been deducted.  As a percentage of her gross pay, 209.5 is

[tex]=\frac{209.5}{14,450} \times 100=0.01449827 \times 100=1.45\%[/tex]

To know more about the social security tax, refer to the link below:

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If you have an orientation where you are completing training exercises on a computer, it is probably a ____.
A new hire orientation
B interactive orientation
C reorientation
D mentorship

Answers

Answer: new hire orientation

Explanation:

New employee orientation is used in order to welcome newly employed workers to the organization and this is done in order to integrate the new workers into the system, train them, and make them feel welcomed and part of the organization. .

This helps to boost the confidence of the employees, leads to increase in the retention of employees and also boost employees morale.

Interaction orientation simply means the interaction that takes place between companies and their customers and this is done in order to improve the relationship with customers and achieve organizational goals.

Mentorship simply means having a mentor to guide an individual. Reorientation simply means to change a particular focus or mindset of certain people.

Based on the explanation, the answer is new hire orientation.

Answer:

A

Explanation:

Which of the following best describes a stock.

A) An incredibly stable investment that is always a safe investment
B) Is insured by the FDIC
C) Represents a share of ownership of a corporation
D) Only sold in the United States

Answers

Answer: C

Explanation: A stock represents a share of ownership of a corporation. Stocks are bought by people so they can get money. If the company's stock they by it from goes well, they get money as well as interest. The answer is C. Hope this helps!

Jerry's job requires that he wear a suit and tie every day to the office. This is most likely a(n) _____ atmosphere.

Answers

Answer:

I would say a formal or business atmosphere.

Explanation:

The main jobs that require suits are often business atmospheres. However, the wearing of a suit is called formal attire.

Answer:

The answer is formal

Explanation:

I took the quiz and got all of the answers right.

Why do you think economists have different belief systems/theories on economics?

Answers

Economists have different belief Systems because Economists also disagree because their methods are not good enough to reveal the whole truth. Economic theory is an attempt to explain and interpret economic data, for example, to determine the causes and effects of economic events.

Answer:The principal disagreement among economists is a matter of economic philosophy. There are two major schools of economic thought: Keynesian economics and free-market, or laissez-faire, economics.

Keynesian economists, named after John Maynard Keynes, who first formulated these ideas into an all-encompassing economic theory in the 1930s, believe that a well-functioning and flourishing economy may be created with a combination of the private sector and government help.

By government help, Keynes meant an active monetary and fiscal policy, which works to control the money supply and adjust Federal Reserve interest rates in accordance with changing economic conditions.

By contrast, the free-market economists advocate a government "hands-off" policy, rejecting the theory that government intervention in the economy is beneficial. Free-market economists—and there are many distinguished advocates of this theory, including Nobel Memorial Prize winner Milton Friedman—prefer to let the marketplace sort out any economic problems. That would mean no government bailouts, no government subsidies of business, no government spending explicitly designed to stimulate the economy, and no other efforts by the government to help what the economists believe is the ability of a free economy to regulate itself.

Explanation:

WILL MARK BRANLIEST!!!!!
Which portion would not be part of an investment portfolio? (Select the best answer.) commodities funds

a savings account

a savings 529 plan

equity investments in a company

Answers

Answer:

a savings 529 plan

Hope this helps plz mark me brainliest

Answer:

A savings account

Explanation:

Took the quiz

It is the idea being transmitted by the sender to the receiver. It includes three aspects — content , structure and style

Answers

Answer:

decodes and feedback.

Explanation:

It is a message since it is written or recorded words or information sharing or ideas conveyed by the sender to the receiver.  It includes information and communication, how important and useful information is, and can be read in order to understand it.  The structure of a message is tone.

The Style includes how the sender composes and writes a message.

Message is the idea being transmitted.

A Message is a form of communication sent to a recipient who is not present physically and its can be in verbal, written or recorded form.

Message is one of the essential elements of communication process. The other process includes Sender, Encoding, Interference, Communication channel, Receiver, Decoding and Feedback

Roughly, there are 3 purposes for passing message

To inform people of certain subject.To persuade others to do one biddingTo builds one's goodwill.

Learn more about Communication process here

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Helppp please
The fact that a country has less strict labor laws and relaxed environmental regulations are strong reasons for a
company to move production facilities to that country.
True
False

Answers

The answer has to be true

Answer:true

Explanation: I just took the test

Fractional reserve banking increases the money supply in an economy by:
A. preventing depositors from leaving a lot of money in banks.
B. requiring the government to print more money in certain
situations.
C. loaning money that would otherwise be held in a bank.
D. accepting currencies from many different countries to pay off
loans.

Answers

Answer:

C. loaning money that would otherwise be held in a bank.

Explanation:

Fractional reserve banking increases the money supply in an economy by "loaning money that would otherwise be held in a bank."

Fractional reserve banking is known as a system of banking whereby the banks hold a fraction of what customers deposit as reserves. Then the banks use the remaining to give loans and thereby creating and increasing the supply of money. Commercial banks practise this type of banking system. This tells of how commercial banks are affecting the money supply. The bank reserves are usually held as cash in the bank. It can also as balances in the bank's account at their central bank.

Answer:

C. loaning money

Explanation:

just did it on a-p-e-x

Which of the following should which of the following should be of concern when a company considers expanding into a new International market?
the country's legal system
the country's political stability
the education level of the workforce
all of the above

Answers

I think it might be (all of the above)

If 135 TV's are sold and cost $275 to produce and is priced at $250, what is the profit/loss?

Answers

Answer:

$25

Explanation:

The production cost is $275.

The selling price is $250

The loss/profit will be: Selling price minus cost price

=$250 - $275

=  -$25

A loss of $25.

If this is the cost for all the 135 TVs, then the loss is only $25.

N:B

If the costs are for one TV, then the loss will be $25 x 135=$3,375

which of the following is a workplace trend?
A - decreased outsourcing
B - decreased attention to diversity
C- increased use of manual labor
D - increased technology literacy

Answers

Answer:

increased use of manual labor

Explanation:

Advancement in technology has resulted in machines taking over manual jobs.  A few decades ago, manual work was done by human beings exclusively. Industries hired many laborers to assist in many aspects of the business. Today, machines and robots are deployed in different sectors of the economy.

The current trend is the workplace is the use of modern technology. Computers, machines, and robots are gradually replacing people, mostly unskilled and manual laborers.

Which of the following occupations is most responsible for ensuring the quality and safety of the food
supply chain?
O chefs
O farmers
O grocery store owners
O food processors

Answers

I would say farmers because all of they rely on their food producs

Answer: I am pretty sure the answer the answer would be the farmers

Explanation: the food comes form the farmers, including meats, veggies, fruits, well you get the point. And if there is something bad with one of the meat animals, they are in charge of not selling the "bad meat" to any stores or big meat companies

Describe the information you will need to provide in order to complete a FAFSA. List at least three of the required documents you must include.

Answers

Answer:

Sample response: To complete a FAFSA, I must first include information to verify my identity. This includes my Social Security number or a driver's license. I must include information about my income or my family's income (if they are still responsible for my care). Finally, I must submit financial information, like my account statements.

Explanation:

2020 edg

In what circumstance would a property insurance claim be rejected?

Answers

• You don’t file your claim promptly
• The cause of property damage falls under an exclusion condition in your policy.
•You haven’t been paying your insurance premiums.
• The damage isn’t sufficiently documented
•The insurance adjuster finds anything suspicious or false in the claim.
•You didn’t take precautions to prevent further damage after the initial loss.

Which of the following vehicles would have a lower insurance premium?
O A brand new SUV
O A used town car

Answers

Answer:

A used town ca

Explanation:

Because its used and that insures that it works so it makes the insurance go down

The correct answer is option B.

A used town car would have a lower insurance premium.

Insurance premium

An insurance premium is the amount of money an individual or business pays for an insurance policy. Insurance premiums are paid for policies that cover healthcare, auto, home, and life insurance.

What is an example of a premium in insurance?

A premium is the price of the insurance you've chosen, charged by your insurance company. A deductible is an amount you have to pay before your insurance company initiates coverage. For example, if your car insurance premium is $800 per year, you must pay your insurer $800 per year to have the insurance.

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Should voting be mandatory?

Answers

Answer: Yes

Explanation:

Answer:

no

Explanation:

because no

Which one of the following businesses would you classify as being in the secondary sector of industry?

A) Oil exploration company
B) Family run farm business
C) Taxi operating business
D) Shoe manufacturer

Answers

Answer:

shoe manufacturer

Explanation:

he U.S. government's ability to pay for Social Security in the near future is a problem because:

Answers

Answer:

Our country's notional debt

Explanation:

what is the role of doctors in our society?​

Answers

Their role is to serve the society as others do basically contribution but their actual role is to help others through their medical knowledge.

Which is used to trace a check back to the account on which it was written?
Group of answer choices

a valid date

an endorsement

a bank route number

a signature

Answers

Answer:

a bank route number

Explanation:

The routing number is among the three numbers found at the bottom of a check. The routing number is at the bottom left.  It serves as an ' identity ' for your bank. The routing number enables other banks to contact your bank and collect funds from your account every time you write a check.

A routing number is a unique number for every banking institution.  The number proves that the bank is a recognized financial institution with an account with the Federal Reserve.

Virtue ethics places great focus on which of the following

Answers

Answer:

character i think.

Explanation:

To satisfy demands for withdrawals, banks keep:
A. discount rates.
B. monetary policies.
C. balance sheets.
D. fractional reserves.​

Answers

C. balance sheets

explanation:

A _____ is an estimation about a future situation based on the evaluation of facts.

1. projection
2. fact
3. salary
4. growth

Answers

Answer:

Projection

Explanation:

Answer:

Yes the correct answer is (PROJECTION)

Explanation:

What is the difference between Money
Market and Investments?

Answers

Answer:

can udo a pic so i can see

Explanation:

TRUE OR FALSE: It is always free to use an ATM if you have a debit card

Answers

Good luck !!! This is what I found

Answer:

False

Some banks/stores will require you to pay if you use an ATM. In some cases, it is not about whether you have a debit card or not. Debit cards are primarily used to remove money from a bank account, not for ATMs.

WILL GIVE BRAINLIEST
If loans and credit card debt are taking up most of your monthly income, which of the following is the LEAST effective first step in getting your debt under control?
A. Start a side hustle and allocate the money you make towards extra payments for your debt.

B. Take a hard look at your budget and try to cut nonessential items so you have more cash to pay down your debt.

C. Declare bankruptcy, which will eliminate all your debts and allow you to start over with a clean slate.

D. Pay extra money each month to the debt with the highest interest rate, so you'll decrease the total amount you'll spend on debt.

Answers

Answer:

a or c i fliped a coin and got A sounds like the answer rember jesus loves you

Explanation:

if i post by business page will you guys follow it ?

Answers

Answer:

Yassss queeeennnn

Explanation:

jdnskakana

Explanation:

Yes i will definately follow it

Other Questions
Tina buys Space Warriors II for $11.26, including tax. She pays with a $20 bill. How much change should she receive? What masses of sodium chloride, magnesium chloride, sodium sulfate, calcium chloride, potassium chloride, and sodium bicarbonate are needed to produce 1 L of artificial seawater for an aquarium? The required ionic concentrations are [Na+] = 3.28 M; [K+] = 0.0094 M; [Mg2+] = 0.0693 M; [Ca2+] = 0.0115 M; [HCO3] = 0.0015 M; [Cl] = 3.32 M; [SO42] = 0.0652 M. , what does Comancheria mean? In a calorimetry experiment, it was determined that a 92.0 gram piece of copper metal released 1860 J of heat to the surrounding water in the calorimeter (Qcopper = -1860 J). If the final temperature of the copper metal-water mixture was 25.00 C, what was the initial temperature of the copper metal? The specific heat of copper is 0.377 J/(gC). a. 28.6 Cb. -28.6 Cc. 78.6 Cd. 92.6 Ce. 53.6 C Question 2 Firas visited a night market where he found a unique t-shirt sold by Kiran for RM20. Firas agreed to the price and handed RM20 to Kiran. He then decided to straightaway wear the t-shirt. While he was still browsing at the market, someone approached him and asked where he bought the t-shirt. Firas brought him to Kirans stall. It turned out that the t-shirt is a rare, limited-edition t-shirt and can fetch RM300 among collectors. Upon hearing this Kiran immediately demanded the t-shirt back and want to return Firas RM20. Kiran claimed that the contract is void due to mistake. Advise Firas whether this is true. (6 Marks) *Answer must be in IRAC method.(Business Law) Serenity Villa opened SV Merchandising Store. The following transactions occurred during the month of July 2019: July 1 Villa invested P128,000 in the business. Acquired computer set for P21,000. Villa paid 5,000 and issued a promissory note for the remaining balance. 2 Acquired supplies for cash, P1,200. 3 Purchase P81,900 of merchandise from LOWKEY company on account. Terms: FOB Destination, 2/10, n/30. 5 Sold merchandise to THORE for P48,600 on account. Terms: FOB Destination, 2/10, n/30. The cost of merchandise sold was P28,880. Paid P550 freight on the same day. 7 Received collections from customers billed on sales of P48,600 on July 5. Returned merchandise purchased from LOWKEY Company, P380. 9 67 11 Paid the amount due from July 3 transaction. 13 Purchase merchandise P12,300 and additional supplies P450 for cash. Paid 15th month salary, P8,000. 15 16 Received refund for poor quality of merchandise from a supplier on cash purchase made on July 13, P870. 18 Sold merchandise to various customers, P24,300. The cost of merchandise is P16,500. 19 Purchase 15,800 of merchandise from Eleonor Shop. FOB Shipping point, terms, 2/10, n/30. 23 24 Receive sales returns, P3,800 from various customers. Its cost is P2,900. Borrowed money from Town Bank, signed promissory note for P13,500. Paid freight on July 21 purchase, P580. 24 26 Sold merchandise on account for P36,800 terms, 2/10, n/30 FOB Destination. The merchandise sold had a cost of P21,300. 28 Serenity Villa withdrew cash from the business, P9,000. 30 Paid Eleonor Shop in full. 31 Paid Salary to employees, P8,000. 31 Paid News Hub for 1 month advertisement of the store, P1,580. Paid Rent and Utilities expenses for the month, P2,800 and P700 respectively. Inventory count at the end of the month: P48,480. Marked out of 1.00 Remove flag. Long-term liabilities include all of the following, except for Select one: a. future income taxes b. lease liabilities O c. wage obligations O d. pension liabilities Clear my choice An 7.9kg bag is lifted 1.21 min 0.50 s. If it is initially at rest, How much force is needed to lift the bag? Suppose a $13,272 loan has an annual compound interest rate of 2.6% with weekly compounding. If the loan's term is 222 weeks, what is its future value?Round your answer to the nearest dollar Given the function f(x)=x2+2x+1, find:f( 1/4 ) .Which of the following categories was introduced as an advancement to the original Linnaean Taxonomy?A. ArchaeaB. FungiC. PlantaeD. Protista Which of the following best defines the term general cash offer? A) Period when stock is selling without a recently declared right, normally beginning two business days before the holder-of-record date. B) The type of underwriting in which the offer price is set based on competitive bidding by investors. Also known as a uniform price auction. OC The date on which existing shareholders on company records are designated as the recipients of stock rights. Also the date of record. D) Underwriter buys the entire issue, assuming full financial responsibility for any unsold shares. OE) An issue of securities offered for sale to the general public on a cash basis. Compare and contrast Mexico and the Caribbean Islands. Three important measures of profit (gross profit, operatingprofit, and net profit) are found on which financial statement?A. Balance SheetB. Income StatementC. Statement of Cash Flows A wall is covered with 6 wood panels. Each panel is a square with a side length of "X"feet. Write an expression to represent the total area, in square feet, covered by thewood panels. Do not include spaces in your answer. With respect to the doctrine on Consideration, Past Consideration is irrelevantCritically discuss this statement, with the following requirements.1. Three (3) applicable case laws on the subject matter2. State clearly The issue Basic facts of the Cases The Judgement In a chemical changea. a phase change occursb. a phase change never occursc. the original material can never be regeneratedd. the products are different substances from the starting materials Mrs. L has been on dialysis for about a year. Over the past several weeks, she has experienced painful open sores, but their cause is unknown and the pain control she has been offered still leaves her in great pain. Mrs. L appreciates that continuing dialysis is prolonging her current painful state with no relief in sight. When she is alone with her nurses, Mrs. L. refuses dialysis and says she just wants "a peaceful death." When meeting with her husband and her physician, Mrs. L. initially resists continuing treatment, but eventually gives in to her husband's wishes. Does she have decision-making capacity? Why or why not? (Hint: Support your answer with reference to established criteria for assessing capacity.) b. Write out the formula for the own price elasticity of demand, and briefly explain under what conditions we would have an inelastic demand, or an elastic demand, or a unitary elastic demand. ( 10 points) c. If in a dictatorship economy, 85% of a nation's wealth is controlled by one dictator and the rest of the population shares the rest 15%, is this outcome Pareto Efficient? Explain why or why not. If this is not Pareto Efficient, suggest a Pareto Improvement transaction. (10 points) q1: Define the fund any explain the type of funds, and write the accounting basis for each type of fund? q2: Explain the revenue and expenditure process within the government unit, support your answer with empirical solutions for both?