All else equal,the nation's money supply increases when the Federal Reserve purchases U.S.Treasury securities.

Question

Quizplus · Accepted Answer

When the Federal Reserve purchases U.S. Treasury securities, it injects money into the economy, thereby increasing the money supply. This is because the seller of the Treasury securities receives payment in the form of reserves, which in turn can be used to create new loans or expand existing investments, leading to an increase in the overall money supply.

All Else Equal,the Nation's Money Supply Increases When the Federal