Suppose that the current federal funds rate is below the federal funds target rate. In order to raise the federal funds rate the Fed will ________________ securities on the open market which will ________________ the supply of reserves in the market for reserves, pushing the rate closer to the target rate
A) sell; increase
B) purchase; increase
C) purchase; decrease
D) sell; decrease
D
You might also like to view...
Which of the following is not an advantage of starting a new business as a corporation?
A) separation of ownership and business liability B) possibility of double taxation C) ability to share risks D) enhanced ability to raise funds
The contribution to total revenues coming from the next worker hired is
A) marginal product. B) marginal revenue product. C) total product. D) total revenues.
When income increases, aggregate expenditure will rise by
a. the change in GDP b. the change in GDP minus the MPC c. the change in GDP times the MPC d. the MPC e. the change in GDP divided by the MPC
Tax loopholes reduce the excess tax burden on individuals.
Answer the following statement true (T) or false (F)