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The US Treasury Sells $2 Billion in Bonds to the Federal

Question 64

Multiple Choice

The U.S. Treasury sells $2 billion in bonds to the Federal Reserve. The Federal Reserve credits the Treasury's account by $2 billion. This exchange is best described as


A) financial impropriety.
B) monetizing the debt.
C) an activity that lies outside of the limits set by Congress.
D) a method for reducing the money supply.

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