The Federal Reserve can decrease the money supply by:
A. conducting open market purchases.
B. introducing deposit insurance.
C. decreasing the discount rate.
D. increasing reserve requirements.
Answer: D
You might also like to view...
If the nominal interest rate is 8.3% and the inflation rate is 4.4%, what is the real interest rate?
Brooke and Sandy both attend the same college and have the same expenses for tuition, books, and supplies. However, Brooke is a famous actress who could earn $2 million per year if she were not attending college whereas Sandy could earn $10,000 a year serving hamburgers if he were not attending college. It follows that the opportunity cost of attending college:
A. is greater for Brooke than for Sandy. B. for Brooke and Sandy cannot be compared. C. is greater for Sandy than for Brooke. D. is the same for both Brooke and Sandy.