An Open Market Purchase of Securities by the Fed Will

question 18

Multiple Choice

An open market purchase of securities by the Fed will

• A) increase assets of the nonbank public and increase assets of the banking system.
• B) decrease assets of the nonbank public and increase assets of the Fed.
• C) decrease assets of the banking system and increase assets of the Fed.
• D) have no effect on assets of the nonbank public but increase assets of the Fed.
• E) increase assets of the banking system and decrease assets of the Fed.