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Suppose the Fed buys $1 billion in Japanese yen from a US FX dealer. a. Use a balance sheet to show the impact of the

Suppose the Fed buys $1 billion in Japanese yen from a US FX dealer.

a. Use a balance sheet to show the impact of the transaction on the US monetary base.

b. Using the same balance sheet, show what the Fed would need to do to keep the monetary base from changing

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