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You are given the following information about the market for reserves. The current federal funds rate is 2.5%, the discount rate is 3.5%, the interest

You are given the following information about the market for reserves. The current federal funds rate is 2.5%, the discount rate is 3.5%, the interest rate paid on reserves is 2.5%, and the Fed owns $400 billion in government securities.

  1. Are there any discount loans outstanding? Why or why not?

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