If the current market federal funds rate is in the target rate range and the demand for reserves decreases, the likely response in the federal funds market will be: ?
A) the market federal funds rate will decrease.?
B) the market federal funds rate will equal the target rate.?
C) the market federal funds rate will increase.?
D) nothing; the reserve supply is so high that the market federal funds rate will be unchanged.
Correct Answer:
Verified
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A) secured loans between banks
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Q16: Reserves currently are so abundant that: ?
A) the federal
Q17: The Fed can _ in the economy. ?
A) change
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