If the Fed Sells Government Securities to a Member of the Nonbank

question 63

Multiple Choice

If the Fed sells government securities to a member of the nonbank public,then the resulting effect on the quantity of money is

• A)much larger than if the securities were sold to a bank.
• B)much smaller than if the securities were sold to a bank.
• C)the same as if the securities were sold to a bank.
• D)that there is no change in the quantity of money.
• E)None of the above answers is correct.

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