If the Treasury buys $2 million in gold, the monetary base will

Name: If the Treasury buys $2 million in gold, the monetary base will
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When the Treasury buys $2 million in gold, it adds $2 million to the monetary base. The monetary base includes currency in circulation and reserves held at the central bank, and buying gold would add to the reserves held at the central bank, hence increasing the monetary base by $2 million.

If the Treasury Buys $2 Million in Gold, the Monetary