If the FOMC Orders the Sale of T-Bills in the Open

question 81

Multiple Choice

If the FOMC orders the sale of T-bills in the open market, then bank reserves are

• A)decreased, but the money supply will remain unchanged.
• B)decreased, and a multiple contraction of the money supply will occur.
• C)increased, but the money supply will remain unchanged.
• D)increased, and a multiple expansion of the money supply will occur.