Which of the following policy actions by the Federal Reserve is likely to increase the money supply?
A. Sell government bonds, decrease reserve requirements, decrease the discount rate.
B. Sell government bonds, increase reserve requirements, increase the discount rate.
C. Buy government bonds, increase reserve requirements, decrease the discount rate.
D. Buy government bonds, decrease reserve requirements, decrease the discount rate.
Answer: D
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An increase in ________ decreases the quantity of money people want to hold
A) the price level B) real GDP C) the interest rate D) the quantity of money
Rent control is an example of a price ceiling. Which of the following problems must be addressed under a rent control program?
a. what to do with the surplus of rental units b. how to subsidize renters so that they can afford to pay the higher rents c. how to decrease the quantity of rental units to the equilibrium level d. whether the opportunity cost of rental units equals the competitive market price e. how to allocate scarce rental units