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If a Bank's Deposits at the Fed Increase by $10

Question 417

Multiple Choice

If a bank's deposits at the Fed increase by $10 million, then


A) both the bank's assets and the Fed's assets increase by $10 million.
B) both the bank's liabilities and the Fed's liabilities increase by $10 million.
C) the bank's assets increase by $10 million and the Fed's liabilities increase by $10 million.
D) the bank's assets increase by $10 million, but there is no change at the Fed since it does not really have assets or liabilities.

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