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Which of the Following Statements Is FALSE

Question 278

Multiple Choice

Which of the following statements is FALSE?


A) Both monetary and interest rate targets cannot be pursued simultaneously.
B) A reduction in the required reserve ratio increases the money supply and pushes down the equilibrium interest rate.
C) An open market purchase reduces the money supply and pushes down the equilibrium interest rate.
D) An open market sale decreases the money supply and pushes up the equilibrium interest rate.

Correct Answer:

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