If the Fed Buys U

question 126

Multiple Choice

If the Fed buys U.S. government bonds from the public, it

• A) increases the volume of reserves in the banking system and the money supply tends to grow.
• B) decreases the volume of reserves in the banking system and the money supply tends to grow.
• C) increases the volume of reserves in the banking system and the money supply tends to fall.
• D) decreases the volume of reserves in the banking system and the money supply tends to fall.

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Definitions:

Sense Of Thrill

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