The Money Supply in Macroland Is Currently 3,000,bank Reserves Are

question 47

Multiple Choice

The money supply in Macroland is currently 3,000,bank reserves are 500,currency held by the public is 500,and the banks' desired reserve-deposit ratio is 20%.Assuming that the values of the currency held by the public and the desired reserve-deposit ratio do not change,if the Central Bank of Macroland wishes to decrease the money supply to 2,500,then it should conduct an open-market ________ government bonds to/from the public.

• A) purchase of 100
• B) purchase of 250
• C) purchase of 500
• D) sale of 100
• E) sale of 500

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