If the Fed Buys $2 Billion of Short-Term Securities Issued

Multiple Choice

If the Fed buys $2 billion of short-term securities issued by the Bank of Japan and pays for them by writing a check for $2 billion,

A) its assets will rise by $2 billion and the monetary base will rise by $2 billion.
B) its assets will fall by $2 billion and the monetary base will fall by $2 billion.
C) its assets will rise by $2 billion and the monetary base will fall by $2 billion.
D) its assets will fall by $2 billion and the monetary base will rise by $2 billion.