Question

If the Federal Reserve sells $30,000 in Treasury bonds to a bank at 4% interest, what is the immediate effect on the money supply?

Answer 1

4% Interest or 4% Margin? Are you SURE you have the right question?

Answer 2

Positive
Question 3 of 10

Multiple Choice: Please select the best answer and click "submit."

If the Federal Reserve sells $30,000 in Treasury bonds to a bank at 4% interest, what is the immediate effect on the money supply?

A. It is decreased by $30,000.
B. It is increased by $30,000.
C. It is increased by $31,200.
D. It is decreased by $31,200.