5. The short-term rate at which banks lend to each other is called the A. Fed Funds Rate 8. Federal Reserve Rate C. Discount Rate D. Federal Loan Rate E. Reserve Loan Rate Assume that the Federal Reserve injects $5 billion into the financial system. If the reserve requirement is 25 percent, what is the maximum increase in money supply (in billions)? 6. A $20.00 B. $21.30 C. $21.88 D. $22.10 E. $22.60 7. If the nominal GDP was reported at $133.2 billion and the real GDP was reported at $129.8 billion, what was the inflation rate for the period? A. 1.59% B. 1.94% C. 2.32% D. 2.62% E. S.88% 8. Which sector has a high sensitivity to the business cycle? A. defensive B. offensive C. lagging D. cyclical E. leading 9. Your $785,000 investment in Mexico gained 6 percent. If the exchange rate moves from 13.4 pesos per dollar to 12.5 per dollar over the period, what is your total return on this investment? A. 12.57% B. 12.86% C. 13.12% D. 13.63% E. 13.91%