Based on the above table, an open market operation in which the Fed purchased $100,000 of government securities would
A) lead to a maximum potential expansion of the money supply of $1 million.
B) create a reserve deficiency for the banking system.
C) cause demand deposits to fall by $100,000.
D) lead to a maximum potential expansion of the money supply of $100,000.
A
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Business cycles disappear when firms
A) hold nominal wages constant as nominal demand changes. B) hold prices constant as nominal demand changes. C) change prices proportionately with nominal demand changes. D) change wages proportionately with nominal demand changes.
Which of the following methods of picking stocks is not consistent with fundamental analysis?
a. doing research such as thoroughly reading and analyzing companies' annual reports b. choosing mutual funds that are managed by individuals with good reputations c. viewing individual stock prices as unpredictable d. relying upon the advice of Wall Street analysts