Author Question: Which of the following happens if the Fed buys bonds from a private bank? A) The Fed's total ... (Read 42 times)

lb_gilbert · **on:** Jun 30, 2018

Which of the following happens if the Fed buys bonds from a private bank?

A) The Fed's total liabilities remain unaffected.
B) The private bank's total assets remain unchanged.
C) The private bank's composition of assets remain unchanged.
D) The Fed's total assets decrease.

Question 2

Alberto purchases ten cups of coffee a week. The amount of money that he holds to purchase ten cups of coffee is the

A) asset demand for money. B) precautionary demand for money.
C) money balance demand for money. D) transactions demand for money.