Which of the Following Fed Actions Will Decrease the Money

question 54

Multiple Choice

Which of the following Fed actions will decrease the money supply?

• A) an open market purchase of Treasury bills
• B) an increase in the required reserve ratio
• C) a decrease in the discount rate relative to the federal funds rate
• D) all of the above
• E) none of the above

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Definitions:

Fixed Costs

Expenses that do not vary in total despite fluctuations in the amount of work or volume of production.

Actual Services

The genuine and realized services provided by a company, as opposed to planned or expected services.

Operating Department

A unit or division within an organization that is directly involved in performing the primary business activities of the company.

Budgeted Rates

Projected costs or expenses associated with specific activities or operations, used for budgeting and planning purposes.