When the Fed Sells a U

question 119

Multiple Choice

When the Fed sells a U.S. bond in the open market

• A) total reserves will increase.
• B) total reserves will decrease.
• C) total reserves do not change but the money supply increases.
• D) total reserves do not change but the money supply decreases.

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Definitions:

Shareholders

Shareholders are individuals or entities that own one or more shares of stock in a corporation, making them partial owners of the company.

Cash Payment

A transaction where an immediate payment of cash is made in exchange for goods or services.

Voucher

A written authorization form containing data about a transaction along with proper authorizations for payment, account distributions, and so forth.

Purchase Requisition

A form used within a business by the requesting department asking the purchasing department of the business to buy specific goods.