If the Federal Open Market Committee Decides to Expand the Money

question 10

Multiple Choice

If the Federal Open Market Committee decides to expand the money supply, then it will

• A)raise the discount rate to member banks.
• B)issue directions to purchase government securities, thus putting more reserves in member banks.
• C)issue directions to sell government securities, thus taking reserves from member banks.
• D)order new Federal Reserve notes delivered to member banks.