When the Fed buys government securities in the open market, the ...

[CQXA]

When the Fed buys government securities in the open market, the money supply ________ because ________.
 
  A) decreases; banks lose liquidity, they make fewer loans and checking account deposits decrease
  B) increases; banks gain liquidity, they make more loans and checking account deposits increase
  C) increases; banks lose liquidity, they make more loans and checking account deposits increase
  D) decreases; banks gain liquidity, they make fewer loans and checking account deposits decrease
  E) none of the above

Question 2

The most severe financial crisis in U.S history occurred in the years ________.
 
  A) 2006-2008
  B) 1997-98
  C) 1929-33
  D) 1873-93

[canderson530]

Answer to Question 1

B

Answer to Question 2

C

[CQXA]

Excellent

[Dominic]

TYSM