5)Answer the question on the assumption that the legal reserve ratio is 10 percent. Suppose that the Fed sells $1,000 of government securities to commercial banks (paid for out of commercial bank reserves) and buys $1,000 of securities from individuals, who deposit the cash in checking accounts. As a result of the given transactions, excess reserves in the banking system Group of answer choices remain unchanged. rise by $100. fall by $100. rise by $1,000
5)Answer the question on the assumption that the legal reserve ratio is 10 percent. Suppose that the Fed sells $1,000 of government securities to commercial banks (paid for out of commercial bank reserves) and buys $1,000 of securities from individuals, who deposit the cash in checking accounts. As a result of the given transactions, excess reserves in the banking system Group of answer choices remain unchanged. rise by $100. fall by $100. rise by $1,000
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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5)Answer the question on the assumption that the legal reserve ratio is 10 percent. Suppose that the Fed sells $1,000 of government securities to commercial banks (paid for out of commercial bank reserves) and buys $1,000 of securities from individuals, who deposit the cash in checking accounts.
As a result of the given transactions,
Group of answer choices
remain unchanged.
rise by $100.
fall by $100.
rise by $1,000
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