If moderate deficits put upward pressure on interest rates,the Fed may ________ bonds,leading to a ________ in high-powered money.
A)sell; fall
B)buy; fall
C)sell; rise
D)buy; rise

Name: If moderate deficits put upward pressure on interest rates,the Fed may ________ bonds,leading to a ________ in high-powered money. A)sell; fall B)buy; fall C)sell; rise D)buy; rise
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Question

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The Fed buys bonds to increase the money supply, which would lead to a rise in high-powered money.

If Moderate Deficits Put Upward Pressure on Interest Rates,the Fed