Answer the Indicated Question on the Basis of the Information

question 26

Multiple Choice

Answer the indicated question on the basis of the information in Table 14.2.Each question is based on the original balance sheet.

-Using the reserve requirement in Table 14.2,if the Fed buys $20 billion worth of bonds in the open market,the lending capacity of the banking system will _______ by approximately ______.

• A) Rise;$20 billion
• B) Rise;$133 billion
• C) Fall;$20 billion
• D) Fall;$133 billion

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Definitions:

Executive Privilege

The right of the president and other high-level officials to withhold information from Congress, the courts, and ultimately the public.

Unitary Executive

A theory in constitutional law that suggests the President possesses the power to control the entire executive branch.

Execute Acts

To carry out, implement, or perform actions or laws as prescribed by a legal or authoritative body.

Nation's Interests

The economic, cultural, and political goals that a country considers important or necessary for its survival and growth.