Unit Test - Part 3

THE FEDERAL RESERVE - UNIT TEST
Part 3:

Complete the flow chart below by placing the following levels of the economy in the correct space- Consumers, The Federal Reserve, Producers, and Member Banks. Then, fill in the blanks to complete the sentences that describe the affects on the money supply at each level.

The Federal Reserve increases the amount of money banks must keep in reserve.		The Federal Reserve decreases the amount of money banks must keep in reserve.
With less money to lend, banks __________ interest rates.		With more money to lend, banks __________ interest rates.
Borrowing ______________ and spending _______________.		Borrowing ______________ and spending _______________.
Demand ________________, production _______________, employment ______________.		Demand ________________, production _______________, employment ______________.