In the 1970s, in Response to Recessions Caused by an Increase

question 124

Multiple Choice

In the 1970s, in response to recessions caused by an increase in the price of oil, the central banks in many countries increased the money supply. How might the central banks have done this?

• A) by selling bonds on the open market, which would have raised the value of money
• B) by purchasing bonds on the open market, which would have raised the value of money
• C) by selling bonds on the open market, which would have lowered the value of money
• D) by purchasing bonds on the open market, which would have lowered the value of money