The Fed sells $1 million in bonds to a bond dealer. The bond dealer's bank experiences
A. a decrease in assets of $1 million as its reserves decrease and a decrease in liabilities of $1 million as its deposits fall.
B. an increase in assets of $1 million as its deposits fell by $1 million, and a decrease in liabilities as its reserves fell by $1 million.
C. no change in assets or liabilities.
D. a decrease in assets of $1 million as its reserves decrease and an increase in liabilities of $1 million as its deposits rise.
Answer: A
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Which of the following is unique to perfect competition?
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