Which of the policies of the U.S. Federal Reserve would most closely match the monetary policy most often used by the ECB?

The problem of the commons arises because ________ exceeds ________ when the resource is used

A) marginal social cost; marginal private cost B) marginal private benefit; marginal social benefit C) marginal private benefit; marginal private cost D) marginal private cost; marginal social cost

Refer to the diagram for the federal funds market. If the federal funds rate rose from 3.5 percent to 4.0 percent, which of the following is the most likely explanation?

A.  The Fed sold bonds to banks.
B.  The Fed bought bonds from banks.
C.  The demand for federal funds fell.
D.  The Fed raised the prime interest rate.