When the Fed Purchases Securities, the Total Funds of Commercial

question 41

Multiple Choice

When the Fed purchases securities, the total funds of commercial banks ____ by the market value of the securities purchased by the Fed. This activity initiated by the FOMC's policy directiveisreferred to as a(n) ____ of money supply growth.

• A) increase; loosening
• B) decrease; tightening
• C) decrease; loosening
• D) increase; tightening
• E) none of the above

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Definitions:

Biological Model

An approach to psychology focusing on understanding human behavior in terms of biological responses and processes.

Learning Model

A theoretical framework that describes how individuals acquire, process, and retain knowledge or skills.

Addiction

A psychological and physical inability to stop consuming a chemical, drug, activity, or substance, even though it is causing psychological and physical harm.

Alcoholism

A chronic disease characterized by uncontrolled drinking and a preoccupation with alcohol.