If the Federal Reserve Sells $200 of Securities Through a Commercial

question 161

Multiple Choice

If the Federal Reserve sells $200 of securities through a commercial bank when the reserve requirement is 10 percent, the maximum potential change in the money supply is

• A) a $200 increase.
• B) a $2,000 increase.
• C) a $200 decrease.
• D) a $2,000 decrease.

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Definitions:

Abdomen

Belly, between the thorax and the pelvis.

Chronic Diarrhea

is a condition characterized by loose or watery stools that lasts for at least four weeks.

Large Intestine

The large intestine is the final section of the gastrointestinal tract that absorbs water and electrolytes, forming and excreting feces.

Enteric Neurons

The neurons of the enteric nervous system that govern the function of the gastrointestinal tract.