Which of the Following Indicates the Primary Mechanism by Which

question 191

Multiple Choice

Which of the following indicates the primary mechanism by which the money supply expands?

• A) The U.S. Treasury prints additional currency.
• B) The Fed purchases additional bonds, which increases the reserves available to the banking system.
• C) The public decides to hold more currency rather than checking deposits.
• D) The U.S. government purchases additional gold.

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Definitions:

Expressed Powers

Specific powers granted to the government or its branches explicitly mentioned in the Constitution.

Bill of Rights

The first ten amendments to the United States Constitution, guaranteeing certain rights and freedoms to American citizens.

Excessive Democracy

A theory that suggests too much direct participation or decision-making power in the hands of the public can lead to instability in governance.

State Legislatures

The legislative bodies of individual states in a federal system, responsible for enacting state laws and policies.