What happened to the measure of money, M0, which includes only cash, bank reserves, and deposits at the Federal Reserve during the crisis?
A) It shrank measurably.
B) It expanded slightly.
C) It more than doubled.
D) There was no change in M0.

Question

Quizplus · Accepted Answer

During the crisis, the Federal Reserve engaged in quantitative easing, which involved purchasing large quantities of government bonds and other securities. This increased bank reserves and deposits at the Federal Reserve, leading to a more than doubling of M0.

What Happened to the Measure of Money, M0, Which Includes