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-The Figure Above Shows the Market for Bank Reserves in Futureland

Question 41

Multiple Choice
-The figure above shows the market for bank reserves in Futureland. If the Bank of Futureland undertakes an open market sale of government securities that changes the quantity of reserves by $100 billion, then the federal funds rate will ________.

-The figure above shows the market for bank reserves in Futureland. If the Bank of Futureland undertakes an open market sale of government securities that changes the quantity of reserves by $100 billion, then the federal funds rate will ________. A) rise to 8 percent a year B) remain at 6 percent a year C) fall to 4 percent a year D) None of the above answers is correct.
-The figure above shows the market for bank reserves in Futureland. If the Bank of Futureland undertakes an open market sale of government securities that changes the quantity of reserves by $100 billion, then the federal funds rate will ________.


A) rise to 8 percent a year
B) remain at 6 percent a year
C) fall to 4 percent a year
D) None of the above answers is correct.

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