Suppose the Fed Buys $10 Million of U

question 187

Multiple Choice

Suppose the Fed buys $10 million of U.S.securities from the public.Assume a reserve requirement of 5 percent and that all banks hold no excess reserves.The total impact of this action on the money supply will be

• A)an increase of $200 million.
• B)a decrease of $200 million.
• C)a decrease of $10 million.
• D)an increase of $10 million.

---

Definitions:

Epithelial Cell Surfaces

The outer layers of cells that line the surfaces and cavities of organs, vessels, and the body, serving as a protective barrier.

Folded Surfaces

Structures in biological systems that have been folded to increase their surface area, enhancing their capacity for processes such as absorption or secretion.

Microvilli

Tiny, finger-like protrusions on the surface of some epithelial cells that increase surface area for absorption and secretion.

Intercalated Disc

Specialized cell-cell junctions between cardiac muscle cells that facilitate the synchronized contraction of the heart.