If the Demand for Money Increases and the Fed Wants

question 158

Multiple Choice

If the demand for money increases and the Fed wants interest rates to remain unchanged,which of the following would be appropriate policy?

• A) Recall Federal Reserve Notes from circulation.
• B) Raise the legal reserve requirement.
• C) Buy bonds in the open market.
• D) Raise the discount rate.

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Definitions:

Neutral Messages

Communications that are designed to be unbiased and unemotional, aiming to convey information without influencing the receiver's feelings or opinions.

Direct Order

A clear and straightforward instruction or command given with the expectation of immediate compliance.

Travel Reimbursement

The process of compensating someone for their travel expenses, often associated with business or work-related trips.

Moderately Formal

A communication style that is less formal than traditional business communication but still follows certain conventions and structures.