1.The duration of a 28-day T-bill is 28 days. (Hint/clarification: The maturity of a 28-day T-bill is 28 days.)

True

False

2.

Everything else held constant, in the market for reserves, when the federal funds rate is 4%, raising the discount rate from 4% to 5%

		increases the borrowed reserves
		increases the nonborrowed reserves
		decreases the borrowed reserves
		decreases the nonborrowed reserves
		none of the above

3.

A homeowner has 2 percent equity in a home worth $100,000. If house prices fall 2 percent, how does the homeowners equity in the home change?

		It increases 2%.
		It falls 100%.
		It falls 2%.
		It falls 98%.
		It increases 98%.