In the Market for Reserves,if the Federal Funds Rate Is

question 120

Multiple Choice

In the market for reserves,if the federal funds rate is above the interest rate paid on excess reserves,an open market sale ________ the supply of reserves causing the federal funds rate to ________,everything else held constant.

• A)decreases;decrease
• B)increases;decrease
• C)increases;increase
• D)decreases;increase

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