When the Fed buys bonds in an open market operation, it can predict what will happen to deposits and currency holdings.

Name: When the Fed buys bonds in an open market operation, it can predict what will happen to deposits and currency holdings.
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When the Fed buys bonds, it injects new money into the economy, which can increase deposits and currency holdings. The Fed can predict the potential effects of this injection on these factors.

When the Fed Buys Bonds in an Open Market Operation