When a primary dealer sells a government bond to the Federal Reserve, reserves in the banking system and the monetary base , everything else held constant.

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21-04-2022
Business

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When a primary dealer sells a government bond to the Federal Reserve, reserves in the banking system and the monetary base , everything else held constant.

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ewomazinoade ewomazinoade · Answer 1 · 2022-05-04T11:43:26+02:00

When a primary dealer sells a government bond to the Federal Reserve, reserves in the banking system increase and the monetary base increase, everything else held constant.

What happens when a primary dealer sells a government bond to the Federal Reserve?

When a primary dealer sells a government bond to the Federal Reserve, it is known as an expansionary monetary policy. An expansionary monetary policy is a policy that increases the money supply in the economy.

An expansionary monetary policy can either be :

reducing reserve ratio
an open market sale

To learn more about monetary policies, please check: https://brainly.com/question/25716528

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When a primary dealer sells a government bond to the Federal Reserve, reserves in the banking system ________ and the monetary base ________, everything else held constant.

Respuesta :

What happens when a primary dealer sells a government bond to the Federal Reserve?

Otras preguntas

When a primary dealer sells a government bond to the Federal Reserve, reserves in the banking system and the monetary base , everything else held constant.