Multiple Choice
If the Federal Open Market Committee decides to expand the money supply, then it will
A) raise the discount rate to member banks.
B) issue directions to purchase government securities, thus putting more reserves in member banks.
C) issue directions to sell government securities, thus taking reserves from member banks.
D) order new Federal Reserve notes delivered to member banks.
Correct Answer:

Verified
Correct Answer:
Verified
Q5: The Fed conducts an open-market sale of
Q6: How are Treasury bond prices affected when
Q7: Why do economists insist on emphasizing the
Q8: The reason that the Fed does not
Q9: The demand for reserves increases as the
Q11: The creation of new bank reserves could
Q12: The quantity of reserves demanded decreases as
Q13: Table 29-1<br>Effects of an open-market transaction on
Q14: Monetary policy is the system of actions
Q15: Which of the following is an unconventional