Reserves in the Banking System Will Decrease If the Fed

question 74

Multiple Choice

Reserves in the banking system will decrease if the Fed:

• A)Buys euros or sells dollars
• B)Sells euros or buys dollars
• C)Buys both euros and dollars at the same time
• D)Sells both euros and dollars at the same time

---

Definitions:

Worst Recession

Refers to the most severe period of economic decline during which trade and industrial activity are reduced, typically recognized by a fall in GDP in successive quarters.

World War II

A global conflict that lasted from 1939 to 1945, involving many of the world’s nations, and marked by significant events like the Holocaust and the use of atomic bombs.

Economic Expansion

A period of increased business activity and economic growth, characterized by higher employment, income, and production levels.

U.S.

Short for the United States of America, a country primarily located in North America.