Question 6 (0.5 pts) The Glass-Steagall Act required It was and a) Commercial banks to have 10% of deposits in reserves/ Approved in 1999/Reinstated after the Great Recession b) Investment banks to have 10% of deposits in reserves/ Approved during the Great Depression/Reinstated after the Great Recession c) A strict separation of the activities of commercial banks vs investment banks/ Approved during the Great Depression/Overturned in 1999 d) That investment banks did not undertake risky investments/Approved during the Great Depression/Overturned during the Great RecessionQuestion 14 {0.5 pts) 1When the Fed increases the monetar},r base, this contributes to increase the supply of M1 to the extent that commercial banks use additional reserves to give loans to their customers. This statement is a) True h) False Question 9 (1 pts) The economy is hit by a positive shock to AE, and it is \"overheating\". Ination is increasing and output is too much higher than the full-employment output. Consequently, the Federal Reserve a] Pursues an expansionary monetary policy and decreases the interest rates. The effects of this policy are represented by graph (1) below b) Pursues an expansionary monetary policy and' increases the interest rates. The effects W are represented by graph (2) below c] Pursues s restrictive monetary policy and increases the interest rates. The effects DEW are represented by graph (1) below d) Pursues a restrictive monetary policy and decreases the interest rates. The effects Wig: are represented by graph (2) below {1) (2} I .-!n'-__'." Question 12 (0.25 pts) The members of the Federal Reserve Board are appointed for 14 years, so that it is ensured that the],r are always aligned with the part}: of the President who governs the United States. This statement is a) True 12-] False Question 13 (11.2.5 pts) The Federal Funds Market is a) The market in which banks lend and borrow reserves to and from each other in overnight loans. The equilibrium on this market determines the federal Funds rate h) The market in which the Fed lends money to commercial hanks' customers. The equilibrium: on this market determines the discount rate c) The market on which the Fed purchases Treasury Bonds from commercial banks. The equilibrium on this market determines the discount rate. d) None of the above. Question 10 (0.25 pts) In any given moment, economists know what the actual value of full-employment output in the US economy is. This statement is a) True b) False Question 11 (0.25 pts) An excessively expansionary monetary policy can cause a too high increase in inflation and lead the economy to "overheat". This statement is a) True b) FalseQuestion 7 (0.5 pts) The main mission of the Federal Reserves is a) Ensure high output growth and boost ination h] Stabilize unemployment and prices c) Follow the directions of the US. government d) Lending money Question 3 (2 pts} The Federal Reserve uses an open market operation to pursue an expansionary monetary policy. Reorder from rst to last the elements below to reconstruct the implementation and the effects of the policy. On your answer sheet, write a number from 1 to 3 next to each letter to represent the \"order\" in which the corresponding element occurs. a) More businesses and households take up loans to finance investments b) The supply of federal funds on the federal funds market increases c) Investments (in machineries, buildings, houses. . .) increase d) The Fed purchases Treasury Bonds from commercial banks e) Aggregate Expenditure increases t) The interest rates that commercial banks charge on loans X mortgages decrease g) The federal funds rate decreases h) The Fed pays commercial banks by increasing their reserves (federal funds)