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Figure 14.4 -Refer to Figure 14.4. If the Fed Wants to Reduce

Question 23

Multiple Choice

  Figure 14.4 -Refer to Figure 14.4. If the Fed wants to reduce the economy's market interest rate from 6 percent to 4 percent, and the reserve ratio is 10 percent, then it needs to _______. A)  buy $20 in government bonds B)  buy $200 in government bonds C)  sell $200 in government bonds D)  sell $20 in government bonds Figure 14.4
-Refer to Figure 14.4. If the Fed wants to reduce the economy's market interest rate from 6 percent to 4 percent, and the reserve ratio is 10 percent, then it needs to _______.


A) buy $20 in government bonds
B) buy $200 in government bonds
C) sell $200 in government bonds
D) sell $20 in government bonds

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