1. During the financial crises and recession of 2007-09, the Fed lowered the federal funds rate target to 0-0.25%. However, long-term interest rates, like mortgage rates, were still fairly high. One thing the Fed did to lower long-term rates was that the Fed:

a. decreased their demand for long-term bonds, which will raise bond prices.

b. bought more long-term bonds, which will lower bond prices.

c. bought more long-term bonds, which will increase bond prices.

d. decreased their demand for long-term bonds, which will lower bond prices.

2.A bank holds deposits worth $13 million. It has $2 million in reserves, and the reserve requirement is 5%. The bank has also given out loans worth $20 millions. These are all the items on the bank's balance sheet at the moment.

This means that the bank capital is $___.