When the Fed Sells One Million Dollars in Securities to a Commercial

question 145

Multiple Choice

When the Fed sells one million dollars in securities to a commercial bank,

• A) there is no change in the total assets of the Fed or the commercial bank.
• B) the commercial bankʹs total assets decrease by one million dollars.
• C) the Fedʹs total assets increase by one million dollars.
• D) None of the above answers is correct.

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Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.