The money supply has decreased from $2.75 trillion to $2.25 trillion. Which of the following could have caused this increase?
A) The Fed purchased government securities from the public.
B) Consumers who were holding money within the banking system withdrew this money.
C) The Fed decreased the discount rate.
D) Commercial banks decide to hold fewer excess reserves.
Correct Answer:
Verified
Q302: Assume there is no leakage from the
Q303: The discount rate cannot be used to
Q304: An open-market _ of securities by the
Q305: As of April 2015, the Fed no
Q306: If the Fed buys securities on the
Q308: The tool most frequently used by the
Q309: When banks hold a large amount of
Q310: The Fed became an active participant in
Q311: As the central bank of the United
Q312: A decrease in the discount rate decreases
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents