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In the Market for Reserves,if the Federal Funds Rate Is

Question 122

Multiple Choice

In the market for reserves,if the federal funds rate is above the interest rate paid on excess reserves,an open market purchase ________ the supply of reserves and causes the federal funds interest rate to ________,everything else held constant.


A) decreases;fall
B) increases;fall
C) increases;rise
D) decreases;rise

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