An Open Market Purchase of Government Securities by the Fed

question 23

Multiple Choice

An open market purchase of government securities by the Fed will not tend to result in which of the following, other things being equal?

• A)increased bond prices
• B)an increase in real output
• C)decreased interest rates
• D)an increase in the price level
• E)All of the above are likely to result from an open market purchase.

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Definitions:

Essential Attributes

Essential attributes refer to the fundamental or inherent qualities that define the nature of something.

Consistent Principle

A rule or standard that remains uniform and unchanged over time, ensuring reliability and predictability in reasoning or behavior.

Jointly Exhaustive

A characteristic of a set of categories or propositions that together cover all possible scenarios or outcomes, leaving no options unaccounted for.

Jointly Exhaustive

A condition in which a set of options or propositions covers all possible outcomes or cases, leaving no scenario unaddressed.