If the Fed Purchases Government Securities on the Open Market,the

question 121

Multiple Choice

If the Fed purchases government securities on the open market,the money supply will

• A)decrease
• B)increase only if the seller of those securities is a commercial bank
• C)increase only if the seller of those securities is a commercial bank belonging to the Fed
• D)increase through the system of securities dealers rather than through the commercial banking system
• E)increase through the commercial banking system regardless of who the seller is

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Definitions:

Earnings Percent

Earnings percent refers to the proportion or percentage of income earned from an investment, work, or business operation relative to the initial cost or investment size.

Workforce

The total number of people employed or available for employment or work in a country, organization, or specific industry.

Crash Of 1929

The severe plunge in stock market prices that initiated the Great Depression, beginning in late October 1929.

Forced Savings

A policy or situation where people are required to save a portion of their income, either through government policies or economic conditions.