Which of the Following Statements Is FALSE

question 106

Multiple Choice

Which of the following statements is FALSE?

• A) Both monetary and interest rate targets cannot be pursued simultaneously.
• B) A reduction in the required reserve ratio increases the money supply and pushes down the equilibrium interest rate.
• C) An open market purchase reduces the money supply and pushes down the equilibrium interest rate.
• D) An open market sale decreases the money supply and pushes up the equilibrium interest rate.

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