If the money multiplier is 10, the sale of $1 billion of securities by the Fed on the open market causes a
A) $10 billion decrease in the money supply.
B) $1 billion decrease in the money supply.
C) $1 billion increase in the money supply.
D) $10 billion increase in the money supply.
A
Economics
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What is the short-run effect of increased deficit spending on an economy experiencing a recessionary gap?
A) Aggregate demand will increase, creating an inflationary ga
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If the population growth rate is 2%, the incremental capital output ratio is 3, the saving ratio is 24%, and the depreciation rate is 5%, the rate of growth of income is
(a) 1%. (b) 2%. (c) 3%. (d) 5%. (e) 8%.
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