Question

The Fed buys​ $5,000 of government securities. The required reserve ratio is​ 15%. Banks hold no excess reserves and there is no currency drain i.e. there are no leakages in the banking system.

​(A) As a result money supply will
A.
increase

B.
decrease


by ​$

nothing
. ​(Enter a numerical value here. Approximate your answer to a whole​ number.)

Answer 1

(A) As a result money supply will
A.
increase

B.
decrease


by $

nothing
. (Enter a numerical value here. Approximate your answer to a whole number.)
Answer: a
5000/0.15=$ 33333