If the Fed wishes to reduce the money supply, it can do all of the following except
A. Raise the discount rate.
B. Sell securities on the open market.
C. Buy shares of common stock in a large bank.
D. Raise the minimum reserve ratio.
Answer: C
Economics
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The Coinage Act of 1792 set the relative values of silver and gold coins at 15 to 1 . Suppose the relative values of silver and gold in the market was 14 to 1 . In this case,
a. only silver would circulate as money. b. silver would be hoarded and sold abroad. c. silver would be overvalued at the mint. d. both gold and silver would circulate as money.
Economics
In an economy with persistent inflation
What will be an ideal response?
Economics