1. Based on New Growth Theory, describe three policies that a government can undertake to achieve faster economic growth
2. List and describe the three functions of money.When someone compares prices, which function of money are they using?
3. Describe three types of banks or financial institution
4. Explain the process by which the banking system creates money (increases the money supply.)
5. When the Federal Reserve buys a government security (engages in an open market purchase), what happens to banks' reserves and the quantity of money? Which changes by more or do both change by the same amount?
6. What is the short-run effect on the nominal interest rate from an increase in the quantity of money? What is the effect in the long run?