The Fed Increases the Reserve Requirement and Makes Open Market

question 192

Multiple Choice

The Fed increases the reserve requirement and makes open market purchases.Which of these by itself will increase the money supply?

• A) neither the increase in the reserve requirement nor the open market purchases
• B) both the increase in the reserve requirement and the open market purchases
• C) only the increase in the reserve requirement
• D) only the open market purchases

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Definitions:

Great Stress

An intense state of physical or emotional strain or tension resulting from adverse or demanding circumstances.

Immune Function

The biological processes and mechanisms within an organism that protect against disease by identifying and killing pathogens and tumor cells.

Short Term

Relating to or occurring over a short period of time, often contrasted with long-term memory or planning.

Long Term

Referring to a prolonged period of time, often extending for years or even decades.