if the banking system has a large amount of reserves many banks will have excess res 639704

1) If the banking system has a large amount of reserves, many banks will have excess reserves to lend and the federal funds rate will probably ________; if the level of reserves is low, few banks will have excess reserves to lend and the federal funds rate will probably ________.

A) fall; fall

B) fall; rise

C) rise; fall

D) rise; rise

2) The Federal Reserve will engage in a repurchase agreement when it wants to ________ reserves ________ in the banking system.

A) increase; permanently

B) increase; temporarily

C) decrease; temporarily

D) decrease; permanently

3) If the Fed wants to temporarily inject reserves into the banking system, it will engage in

A) a repurchase agreement.

B) a matched sale purchase transaction.

C) a reverse repurchase agreement.

D) an open market sale.

4) The Fed can offset the effects of an increase in float by engaging in

A) a repurchase agreement.

B) a matched sale purchase transaction.

C) an interest rate swap.

D) an open market purchase.