If the Fed Wishes to Reduce the Money Supply,it Can

question 127

Multiple Choice

If the Fed wishes to reduce the money supply,it can do all of the following except

• A)Raise the discount rate.
• B)Raise the minimum reserve ratio.
• C)Sell securities on the open market.
• D)Buy shares of common stock in a large bank.

---

Definitions:

Prepaid Insurance

An asset account that represents the amount of insurance premiums paid in advance for coverage that extends beyond the current accounting period.

Consulting Revenue

Income earned by a business or individual for providing expert advice or consultancy services in their field of expertise.

Rent Expense

An expenditure recorded by a company for the use of rental property or equipment.

Post-Closing Trial Balance

A summary of all account balances in a company's general ledger after closing entries are made, serving to verify the equality of debits and credits.