To Reduce the Money Supply, the Federal Reserve

question 88

Multiple Choice

To reduce the money supply, the Federal Reserve:

• A) buys government bonds.
• B) sells government bonds.
• C) creates demand deposits.
• D) destroys demand deposits.

---

Definitions:

Independently

Without being influenced by others or by external factors; in statistics, refers to events that have no effect on the likelihood of other events occurring.

Sampling Distribution

The calculated probability distribution relevant to a specific statistic, achieved by random sampling.

Sample Mean Difference

The difference between the average values of two samples drawn from a population.

Populations

The entire pool from which a statistical sample is drawn and to which inferences are aimed in statistics.