Consider a $2 Billion Open Market Purchase of U

question 72

Multiple Choice

Consider a $2 billion open market purchase of U.S. Treasury securities by the Federal Reserve. The Banking System's balance sheet will specifically show:

• A) only an increase in liabilities of $2 billion.
• B) only a decrease in assets of $2 billion.
• C) no net change in assets or liabilities, only a change in the composition of assets with securities decreasing and reserves increasing by $2 billion respectively.
• D) no net change in assets or liabilities, only a change in the composition of assets with securities increasing and reserves decreasing by $2 billion respectively.

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Definitions:

Industrial Production

The process of manufacturing goods and materials in factories and plants, typically on a large scale.

Alienated

Feeling isolated and separated from a group or activity to which one should belong or in which one should be involved, often discussed in the context of work and labor.

Produce

To create or bring forth goods and services through various processes of production and labor.

Alienation

The feeling of disconnect or estrangement individuals experience when they are unable to find meaningful connections with their work, others, or the society at large.