When the Fed purchases government securities, it:
a. has no effect on either the money supply or the discount rate.
b. uses discounting operations to influence margin requirements.
c. increases banks' reserves and makes possible an increase in the money supply.
d. decreases banks' reserves and makes possible a decrease in the money supply.
e. automatically raises the discount rate.
c
You might also like to view...
Based on the table "Real and Nominal GDP," if year one is the base year, then the real GDP in year two, is ________
A) 5000 B) 5250 C) 5900 D) 6175 E) none of the above
All of the following will cause the supply curve of good A to shift rightward EXCEPT
A. a reduction in the prices of inputs used to produce good A. B. a decrease in the per-unit tax on good A which producers must pay. C. an increase in the number of firms in the industry producing good A. D. an increase in the market price of good A.
A flat wage profile refers to
A) wage compression. B) backloaded compensation. C) an efficiency wage. D) deferred compensation.
Deposits are examples of a bank's:
A. assets. B. liabilities. C. net worth. D. balance sheet.