An example of a tool used by the Fed that decreases the money supply is:

Name: An example of a tool used by the Fed that decreases the money supply is:
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Question

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When the Fed sells government bonds in the open market, it decreases the amount of money available in the banking system. This is because when the Fed sells a bond, the buyer pays for it by transferring funds from their own bank account to the Fed's account. This reduces the amount of money in the buyer's bank, and thus the overall money supply.

An Example of a Tool Used by the Fed That