Economics > EXAM > Summary: The Economics of Money, Banking and Financial Markets by Mishkin Questions and Answers 2023 (All)

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Summary: The Economics of Money, Banking and Financial Markets by Mishkin Questions and Answers 2023

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federal funds rate - -The interest rate at which banks make overnight loans to one another -conventional monetary policy tools - -The usual tools of monetary policy that the Federal Reserve uses t... o control the money supply and interest rates: open market operations, discount lending, and reserve requirements. 364 -dynamic open market operations - -Those open market operations that are intended to change the level of reserves and the monetary base. -defensive open market operations - -Those open market operations that are intended to offset other factors that affect reserves and the monetary base (such as changes in Treasury deposits with the Fed or float). -primary dealers - -Government securities dealers, operating out of private firms or commercial banks, with whom the Fed's open market desk trades -repurchase agreement - -Fed purchases securities with an agreement to resell at specific date -matched sale purchase transaction - -When the fed wants to conduct a temporary open market sale it will sell securities and the buyer agree to sell them back to the fed in the near future. Also called a reserve repo -standing lending facility - -a lending facility in which healthy banks are allowed to borrow all they want from a central bank -lender of last resort - -the Fed provides funds to troubled banks that cannot find any other sources of funds [Show More]

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