When the Federal Reserve Sells Assets from Its Portfolio to the Public

question 41

Multiple Choice

When the Federal Reserve sells assets from its portfolio to the public with the intent of changing the money supply,

• A)those assets are government bonds and the Fed's reason for selling them is to increase the money supply.
• B)those assets are government bonds and the Fed's reason for selling them is to decrease the money supply.
• C)those assets are items that are included in M2 and the Fed's reason for selling them is to increase the money supply.
• D)those assets are items that are included in M2 and the Fed's reason for selling them is to decrease the money supply.

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Definitions:

Rated

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Overestimated

The act of appraising something or someone too highly or beyond its actual value or capacity.

Relationship-oriented

An approach or behavior that emphasizes the importance of personal connections and relationships in problem-solving or management.

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An individual who provides guidance, instruction, direction, and leadership to a group of individuals (the team) for the purpose of achieving a key result or group of aligned results.