3. If the Federal Reserve sells bonds: Bank reserves and bank liabilities fall as bondholders reduce their checking accounts by writing checks for the bonds Bank reserves and bank liabilities rise as bondholders reduces their checking accounts by writing checks for the bonds Only bank liabilities fall as bondholders reduce their checking accounts by writing checks for the bonds Bank reserves and bank liabilities rise as bondholders reduces their checking accounts by writing checks for the bonds

Answer rating: 100% (QA)

The correct answer is 4 Bank reserves and bank liabilities rise as bondholders reduce their chec... View the full answer