An open market purchase of bonds by the Fed
a. drains reserves from the banking system and decreases the money supply
b. injects reserves into the banking system and increases money demand
c. injects reserves into the banking system and increases the money supply
d. drains reserves from the banking system and increases the money supply
e. injects reserves into the banking system and decreases the money supply
C
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Every fiscal or monetary action will affect the distribution of output as well as its volume
Indicate whether the statement is true or false
If the residents of a country specialize in a good in which they have a comparative advantage and trade with residents in another nation, the residents in the first country
A) can consume more than they could without trade. B) can produce more than they could without trade. C) will have a lower standard of living. D) will be exploited by the second nation.