Questions from Macroeconomics

Q: How does financial regulation in Canada help minimize the cost of bank

How does financial regulation in Canada help minimize the cost of bank failure? Does it bring more stability to the banking system?

Q: If the Bank of Canada makes an open market sale of $

If the Bank of Canada makes an open market sale of $1 million of securities to a bank, what initial changes occur in the economy?

Q: Set out the transactions that the Bank of Canada undertakes to increase

Set out the transactions that the Bank of Canada undertakes to increase the quantity of money.

Q: Describe the Bank of Canada’s assets and liabilities. What is the

Describe the Bank of Canada’s assets and liabilities. What is the monetary base and how does it relate to the Bank of Canada’s balance sheet?

Q: The U.S. Federal Reserve discussed “a new largescale

The U.S. Federal Reserve discussed “a new largescale asset purchase program” commonly called “QE3.” Some members said such a program could help the economy by lowering long-term interest rates and mak...

Q: Banks in New Transylvania have a desired reserve ratio of 10 percent

Banks in New Transylvania have a desired reserve ratio of 10 percent of deposits and no excess reserves. The currency drain ratio is 50 percent of deposits. Now suppose that the central bank increases...

Q: Explain the change in the nominal interest rate in the short run

Explain the change in the nominal interest rate in the short run if: a. Real GDP increases. b. The Bank of Canada increases the quantity of money. c. The price level rises.

Q: What are the four main ways in which the CPI is an

What are the four main ways in which the CPI is an upward-biased measure of the price level?

Q: The figure shows an economy’s demand for money curve. /

The figure shows an economy’s demand for money curve. If the central bank decreases the quantity of real money from $400 billion to $390 billion, explain how the price of a bond wil...

Q: Use the data in Problem 7 to work this problem. The

Use the data in Problem 7 to work this problem. The interest rate is 4 percent a year. Suppose that real GDP decreases from $20 billion to $10 billion and the quantity of money remains unchanged. Do p...