ECO 372 Week 3 DQs

This document of ECO 372 Week 3 Discussion Questions consists of:

1. There are three functions of money.

2. The Federal Funds rate is the interest rate banks charge each other

3. Interest rate increases have the same impact on all types of purchases (purchasing inventory item that you expect to sell in less than a week; the purchase of a pickup truck financed for 3 years; and the purchase of a home or new building your business financed for 30 year home mortgage)

4. Commercial banks can create money.

5. The value of money is fundamentally determined by the gold and silver for which it can be redeemed.

6. The Federal Reserve System has several ways to increase the money supply.

7. The primary purpose of the FOMC is to enforce bank regulations.

8. The Fed is a private agency.

9. The Fed has 3 functions.

10. I could use the “Rule of 72” to write a statement about inflation and growth.

11. There is little difference between a fixed rate and adjustable rate home mortgage

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