If the Fed Buys $100,000 in U

question 99

Multiple Choice

If the Fed buys $100,000 in U.S. government securities from a commercial bank, the bank now has an additional $100,000 of

• A) total assets.
• B) excess reserves.
• C) actual reserves.
• D) net worth.

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Definitions:

Market Price

The present cost at which an item or service may be purchased or sold within a specific market.

Individual Transferable Quota (ITQ)

A policy tool that allocates the right to harvest a natural resource amount among users through transferable quotas.

Market Price

The price at which a good or service can be bought or sold in the open market, determined by supply and demand.