SOLVED

20.1Â Â The Fed’s Balance Sheet 1) The bank reserve equation is the A) assets and liabilities of the entire banking system. B) tally sheet for sources and uses of reserves. C) M1 multiplier. D) Federal Reserve’s method of determining how many government securities to purchase. 2) Which of the following appears as an asset on the Federal Reserve’s balance sheet? A) Capital accounts B) U.S. Treasury deposits C) U.S. government securities held under repurchase agreements D) Federal Reserve notes outstanding 3) Which of the following appears as an asset on the Federal Reserves balance sheet? A) Commercial bank deposits B) Bank reserves C) Gold certificates D) U.S. Treasury deposits 4) Which of the following appears as a liability on the Federal Reserves balance sheet? A) U.S. government securities owned outright B) Commercial bank deposits C) Gold certificates D) Cash items in the process of collection 5) Which of the following appears as a liability on the Federal Reserves balance sheet? A) U.S. Treasury deposits B) Special drawing rights C) U.S. government securities held under repurchase agreements D) Loans to commercial banks 6) The largest item on the asset side of the Federal Reserve balance sheet is A) Federal Reserve notes. B) U.S. government securities. C) gold. D) U.S. Treasury deposits. 7) The largest item on the liability side of the Federal Reserve’s balance sheet is A) commercial bank deposits. B) U.S. government securities. C) cash items in the process of collection. D) Federal Reserve notes outstanding. 8) Which of the following is a correct statement regarding the balance sheet of the Federal Reserve? A) Fed assets = Fed liabilities + Federal Reserve notes B) Fed assets = Fed liabilities + Fed capital accounts C) Fed assets = Fed liabilities + bank reserves D) Fed assets = bank reserves + Federal Reserve notes outstanding 9) Which of the following is a correct statement regarding the balance sheet of the Federal Reserve? A) Fed assets = Fed liabilities + Federal Reserve notes B) Bank reserves = Fed Assets – (Fed liabilities – bank reserves) + Fed capital accounts C) Fed liabilities = Fed Capital Accounts + bank reserves D) Fed assets = bank reserves + Federal Reserve notes outstanding 10) Federal Reserve liabilities are equal to A) gold certificates + other Fed liabilities. B) bank reserves + other Fed liabilities. C) Federal Reserve notes. D) cash + loans + U.S. Treasury deposits.