If the Fed Purchases $1 Million in Securities from the Nonbank

question 48

Multiple Choice

If the Fed purchases $1 million in securities from the nonbank public, the monetary base will rise by $1 million

• A)if the public holds the proceeds as currency.
• B)if the public deposits the proceeds as checkable deposits.
• C)if the public deposits the proceeds with the Treasury in a monetary base account.
• D)whether the public holds the proceeds as currency or deposits them as checkable deposits.

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Definitions:

Installment Sales Method

An accounting method used to recognize revenue from sales where payment is received in installments over a period.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) aimed at making global financial reporting more transparent and comparable.

Realized Gross Profit

The portion of profit that has been earned from completed sales transactions, excluding unrealized profits from continuing transactions.

Bundled Sales Transactions

sales deals that involve multiple products or services sold together at a combined price, potentially affecting revenue recognition and reporting.