When the Fed buys government bonds, the money supply increases and the federal funds rate increases. a. the money supply increases and the federal funds rate decreases. b. Oc. the С. money supply decreases and the federal funds rate increases. the money supply decreases and the federal funds rate decreases. d.

Economics:
10th Edition
ISBN:9781285859460
Author:BOYES, William
Publisher:BOYES, William
Chapter13: Monetary Policy
Section: Chapter Questions
Problem 5E
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When the Fed buys government bonds,
the money supply increases and the federal funds rate increases.
a.
Cn the money supply increases and the federal funds rate decreases.
the money supply decreases and the federal funds rate increases.
C.
the money supply decreases and the federal funds rate decreases.
d.
O O O
Transcribed Image Text:When the Fed buys government bonds, the money supply increases and the federal funds rate increases. a. Cn the money supply increases and the federal funds rate decreases. the money supply decreases and the federal funds rate increases. C. the money supply decreases and the federal funds rate decreases. d. O O O
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