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    Principles of Economics Study Set 1
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    Exam 26: Stabilizing the Economy: The Role of the Fed
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    When the Fed Engages in an Open Market Purchase, the Money
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When the Fed Engages in an Open Market Purchase, the Money

Question 127

Question 127

Multiple Choice

When the Fed engages in an open market purchase, the money supply ________ and the nominal interest rate ________.


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

Correct Answer:

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