When conducting an open-market sale, the Fed ()
A: buys government bonds, and in so doing increases the money supply.
B: buys government bonds, and in so doing decreases the money supply.
C: sells government bonds, and in so doing increases the money supply.
D: sells government bonds, and in so doing decreases the money supply.
A: buys government bonds, and in so doing increases the money supply.
B: buys government bonds, and in so doing decreases the money supply.
C: sells government bonds, and in so doing increases the money supply.
D: sells government bonds, and in so doing decreases the money supply.
举一反三
- Inflation occurs when: （ ） A: the stock of goods and services increases and the quantity of money in circulation decreases. B: the money supply decreases and the output increases. C: output increases faster than the money supply. D: the quantity of money in circulation rises faster than the stock of goods and services.
- When the Fed is ________ it is ________. A: adjusting the amount of money in circulation; issuing government bonds B: issuing government bonds; conducting monetary policy C: adjusting the amount of money in circulation; conducting monetary policy D: regulating the nation's financial institutions; conducting monetary policy
- Which of the following actions by the Fed would reduce the money supply? A: an open-market purchase of government bonds B: a reduction in banks’ reserve requirements C: an increase in the interest rate paid on reserves D: a decrease in the discount rate on Fed lending
- 9,Authorities also use a third option called open market operations to _______ or contract the money supply in the country’s banking system. It involves buying and selling of government securities like bonds or foreign currencies in the open market.
- When the expected inflation rate decreases, the demand for bonds _________, the supply of bonds _________, and the interest rate _________.