Question
A commercial bank buys a $20,000 government security from a securities dealer. The bank pays the dealer by increasing the dealers checkable deposit balance by
A commercial bank buys a $20,000 government security from a securities dealer. The bank pays the dealer by increasing the dealers checkable deposit balance by $20,000. The money supply has
A. increased by $20,000
B. decreased by $20,000
C. not been affected
D. increased by $20,000 multiplied by the reserve ratio
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Macroeconomics Principles and Applications
Authors: Robert E. Hall, Marc Lieberman
6th edition
1111822352, 1111822354, 9781133708742 , 978-1111822354
