This Method of Financing Government Spending Is Frequently Called Printing

question 51

Multiple Choice

This method of financing government spending is frequently called printing money because high-powered money (the monetary base) is created in the process.

• A) Financing government spending with taxes.
• B) Financing government spending through a Treasury sale of bonds that are then purchased by the Fed.
• C) Financing government spending by selling bonds to the public, which pays for the bonds with currency.
• D) Financing government spending by selling bonds to the public, which pays for the bonds with checks.

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Definitions:

\(d = \frac { 3 } { 7 }\)

Represents a specific value of the variable d, which is equal to the fraction three-sevenths.

\(d = 4\)

An equation representing that the value of the variable \(d\) is equal to 4.

\(a _ { 1 }\)

Often represents the first term in a sequence or series in mathematics, particularly in formulas involving arithmetic or geometric sequences.

\(a _ { k + 1 }\)

An element in a sequence, described as the next term (k+1) following the kth term.