Macroeconomics

‭Review Quiz Answers‬ ‭1.‬ ‭C‬ ‭2.‬ ‭D‬ ‭3.‬ ‭C‬ ‭4.‬ ‭B‬ ‭5.‬ ‭C‬ ‭6.‬ ‭D‬ ‭7.‬ ‭B‬ ‭8.‬ ‭A‬ ‭9.‬ ‭B‬ ‭10.‬ ‭C‬ ‭Checkpoint Quiz Answers‬ ‭Checkpoint Quiz 1:‬

‭The‬ ‭discount‬ ‭rate‬ ‭and‬ ‭the‬ ‭federal‬ ‭funds‬ ‭rate‬ ‭are‬ ‭raised‬ ‭to‬ ‭discourage‬ ‭banks‬ ‭from‬ ‭borrowing‬ ‭which‬ ‭reduces‬ ‭lending‬ ‭and‬ ‭money‬ ‭supply.‬ ‭The‬ ‭IOR‬ ‭is‬ ‭increased‬ ‭to‬ ‭encourage‬ ‭commercial‬ ‭banks‬ ‭to‬ ‭deposit‬ ‭more‬‭reserves‬‭with‬‭the‬‭Fed,‬‭which‬‭reduces‬‭their‬‭ability‬‭to‬‭lend‬‭and‬‭increase‬‭money‬‭supply.‬‭Finally,‬‭the‬‭rr‬ ‭is raised to reduce banks’ deposits and lending ability in order to reduce money supply.‬

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