Explain which of the following are counted as part

of the money supply (M1):

a. Checking account deposits

b. Stocks

c. Savings account deposits

d. Government bonds

3.

If the reserve requirement (rr) is 0.2, what is

the simple deposit multiplier? If, in addition, the

currency deposit ratio (c) is 0.05 and the excess

reserve ratio (e) is 0.15, what is the money multiplier?

Explain why the money multiplier differs

from the simple deposit multiplier

5 

Explain which of these interest rates the Federal

Reserve sets:

a. The discount rate

b. The federal funds rate

c. The prime rate

1. Explain which of these interest rates the Federal

Reserve sets:

a. The discount rate

b. The federal funds rate

c. The prime rate