The
result of the too-big-to-fail policy is that banks will take
on risks, making bank failures more likely.

7.Purchases and sales of government securities by the Federal Reserve are called

6. The interest rate the Fed charges banks borrowing from the Fed is the

5. Suppose that from a new checkable deposit, First National Bank holds two million dollars in vault cash, eight million dollars on deposit with the Federal Reserve, and nine million dollars in excess reserves. Given this information, we can say First National Bank faces a required reserve ratio ofpercent.

4. Total Reserves minus vault cash equals

3. The sum of the Fedʹs monetary liabilities and the U.S. Treasuryʹs monetary liabilities is called

2. Both____and______are Federal Reserve assets.

1.The three players in the money supply process include

10. The Federal Reserve Bank ofplays a special role in the Federal Reserve System because it houses the open market desk.

9. The Federal Reserve Banks are_______institutions since they are owned by the _______.

8. What makes the Federal Reserve so unique compared to other central banks around the world is its