If the Fed buys $100 in securities from a commercial bank, the

Name: If the Fed buys $100 in securities from a commercial bank, the
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When the Fed buys securities from a commercial bank, it pays for these securities by adding reserves to the bank's account at the Fed. This increases the quantity of reserves in the banking system, which can lead to an expansion of the money supply through the multiple deposit creation process. Thus, the correct answer is D, as the quantity of reserves will increase.

If the Fed Buys $100 in Securities from a Commercial