When the Fed Buys Treasury Bills as a Means of Increasing

question 13

Multiple Choice

When the Fed buys Treasury bills as a means of increasing the money supply, it places ____ pressure on their prices and ____ pressure on their yields.

• A)upward; upward
• B)downward; downward
• C)upward; downward
• D)downward; upward

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Definitions:

Demand Shifts Left

A demand shift left is when the demand curve for a good or service shifts to the left, indicating a decrease in demand at all price levels, often due to changes in consumer preferences, income, or substitutes.

Air Travel

The act of traveling in an aircraft, often commercially, where passengers are transported from one location to another.

Law of Demand

Economic principle stating that as the price of a good increases, the quantity demanded decreases, and vice versa, ceteris paribus.

Ticket Prices

The cost at which an individual can purchase a ticket to gain entry to an event, such as a concert, movie, or sports game.