If the Fed Buys Securities on the Open Market,this Will

question 124

Multiple Choice

If the Fed buys securities on the open market,this will

• A)reduce banks' excess reserves.
• B)increases banks' excess reserves.
• C)lower the reserve requirement.
• D)contract the money supply.

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Definitions:

Liter

A metric unit of volume equal to 1,000 cubic centimeters or approximately 0.26 gallons.

Ounce

A unit of weight in the U.S. customary and British imperial systems, equal to 1/16 of a pound.

Milligrams

A metric unit of mass equal to one thousandth of a gram, commonly used to measure small quantities of substances.

Kilograms

A metric unit of mass equal to 1000 grams.