Describe how banks create money. If the Fed wanted to use all three of its policy tools

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Describe how banks create money. If the Fed wanted to use all three of its policy tools to decrease the money supply, what would it do?

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Principles of economics

ISBN: 978-0538453042

6th Edition

Authors: N. Gregory Mankiw

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Question Posted: Dec 14, 2012 06:11 AM

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Describe how banks create money. If the Fed wanted to use all three of its policy tools

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Banks create money when they hold a fraction of their deposits in reserve and lend out the ...View the full answer

Principles of economics

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