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The Community College Student
An overview of the Iowa community college students. Presented to ALOP 282 sem...
Homework #5
Economics 101 – MacroeconomicsProfessor SchenkDue:
October 15, 20091.On November 6
th
, 2002, the FOMC released a statement: “The Federal OpenMarket Committee decided today to lower its target for the federal funds rateby 50 basis points to 1 1/4 percent.” Using the series of graphs below, followthe progress and actions of the FOMC.a.What happens in the bond market? Chart the answer and write a brief explanation.b.What happens to the supply of money? Chart the answer and write abrief explanation.
BondsS1D1QuantityPriceMoneyD1QuantityInterestS1
c.What happens to the loan market? Chart your answer and write a brief explanation.d.How will the loan market affect the overall economy? Write anexplanation in words.e.What happens in the aggregate economy (use the interpretation inpart d)? Chart your answer.
LoansS1D1QuantityInterestAD1GDPPricesAS1
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Money and Monetary Policy
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