When the Federal Reserve Decreases Bank's Reserves Through an Open-Market

question 308

Multiple Choice

When the Federal Reserve decreases bank's reserves through an open-market operation:

• A)deposits increase, currency in circulation increases, and the monetary base remains the same.
• B)the monetary base decreases, the money multiplier decreases, and the money supply increases.
• C)loans increase, the federal funds rate rises, and the discount rate rises.
• D)the monetary base decreases, loans decrease, and the money supply decreases.

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Definitions:

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The theory suggesting that facial expressions can influence emotional experiences.

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The process of conveying a message without the use of words, through body language, facial expressions, gestures, and other visual cues.

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A hormone produced mainly by the stomach that stimulates appetite, increases food intake, and promotes fat storage.

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The rate at which the body expends energy or burns calories, crucial for maintaining bodily functions and health.