Question: Please answer the following whether they are true or false part 1: An open market sale always decreases the quantity of nonborrowed reserves supplied but

Please answer the following whether they are true or false

part 1: An open market sale always decreases the quantity of nonborrowed reserves supplied but does not necessarily increase the federal funds rate.

part 2: Banks tend to take excessive risks knowing the Fed will act as the lender of last resort. This problem is an example of adverse selection.

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