2. Problems and Applications Q2

When the Fed buys bonds in open-market operations, it the money supply.

If the Fed raises the reserve requirement, the money supply .

When the Fed decreases the interest rate it pays on reserves, the money supply will .

When the FOMC decreases its target for the federal funds rate, the money supply will .

If people decide to hold less currency after a rash of pickpocketing, the money supply .