To offset the effect of households and firms deciding to hold more of their money in checking account deposits and less in currency, the Federal Reserve could
A) raise bank taxes.
B) sell Treasury securities.
C) raise government spending.
D) lower the required reserve ratio.
Answer: B
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An increase in supply of a product results when:
A. taxes on the product are increased. B. the companies that produce the product have higher materials costs. C. technological innovations are introduced in the manufacturing process. D. the government reduces subsidies on the product.
Explain several implications and characteristics of efficiency wage theories
What will be an ideal response?
The aggregate demand curve would shift to the right as a result of
A. a decrease in the U.S. real interest rate. B. a decrease in the amount of money in circulation. C. a drop in the price level. D. tax increases.
A country has a current account surplus if
A. the value of its net exports of services exceeds the value of its net exports of goods. B. it receives more income from foreign assets than it pays to foreigners for foreign-owned domestic assets. C. its capital inflows exceed its capital outflows. D. the value of its exports exceeds the value of its imports, assuming net income from foreign assets and net unilateral transfers have a value of zero.