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The Effect of an Open Market Purchase on Reserves Differs

question 62

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The effect of an open market purchase on reserves differs depending on how the seller of the bonds keeps the proceeds.If the proceeds are kept in ________,the open market purchase has no effect on reserves; if the proceeds are kept as ________,reserves increase by the amount of the open market purchase.


Definitions:

Manufacturing

The process of producing goods by transforming raw materials into finished products, using labor, machinery, and chemical processing.

Scientific Management

A theory of management that analyzes and synthesizes workflows to improve economic efficiency, especially labor productivity, pioneered by Frederick Taylor.

Scientific Management

A management theory focusing on improving efficiency and labor productivity through scientific studies of tasks.

Frederick W. Taylor

An American mechanical engineer who is considered the father of scientific management, focusing on efficiency improvement through the analysis and optimization of workflow.

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