Statement I: When the Fed Sells U

question 242

Multiple Choice

Statement I: When the Fed sells U.S.government securities on the open market,excess reserves are increased.
Statement II: Banks try to carry large balances of excess reserves.

• A)Statement I is true and statement II is false.
• B)Statement II is true and statement I is false.
• C)Both statements are true.
• D)Both statements are false.

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