If the Fed Carries Out an Open Market Operation and Sells

question 33

True/False

If the Fed carries out an open market operation and sells U.S. government securities, the federal funds rises and the quantity of money decreases.

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Definitions:

Cash Flow Classifications

The categorization of cash flows into operating, investing, and financing activities for the purpose of financial reporting and analysis.

Free Cash Flow

The cash a company generates after accounting for cash outflows to support operations and maintain its capital assets.

Net Cash Flow

The amount of cash that is generated or lost by a business in a given period, considering cash inflows and outflows from operating, investing, and financing activities.

Indirect Method

A cash flow statement approach that adjusts net income for the changes in balance sheet accounts to calculate the cash from operating activities.