Econ unit 4

Question 1

Shifters of demand for money

Answer 1

Price level, income, and technology

Question 2

shifters of money supply

Answer 2

reserve ratio, discount rate, and open market operations

Question 3

demand loanable funds: Think of businesses

Answer 3

consumer expectations, gov deficit spending (gov spends more then taxes so needs to borrow)

Question 4

Supply of loanable funds: Think of consumers saving money

Answer 4

disposable income (more to save), economic outlook, foreign investment

Question 5

Discount rate

Answer 5

Interest rate fed charges banks to loan

Question 6

Fed funds rate

Answer 6

Rate banks charge each other for loans