Consider a $2 billion open market purchase of U.S. Treasury securities by the Federal Reserve. The Banking System's balance sheet will specifically show:
A. no net change in assets or liabilities, only a change in the composition of assets with securities increasing and reserves decreasing by $2 billion respectively.
B. only an increase in liabilities of $2 billion.
C. only a decrease in assets of $2 billion.
D. no net change in assets or liabilities, only a change in the composition of assets with securities decreasing and reserves increasing by $2 billion respectively.
Answer: A
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A) Red B) Blue C) Beige D) Green
Recessions in Canada and Mexico would cause
a. the U.S. price level and real GDP to rise.
b. the U.S. price level and real GDP to fall.
c. the U.S. price level to rise and real GDP to fall.
d. the U.S. price level to fall and real GDP to rise.
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What will be an ideal response?
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What will be an ideal response?