Question: Select the answer that correctly describes the effect on the money supply of the following monetary policy: The Fed sells $ 3 0 million worth
Select the answer that correctly describes the effect on the money supply of the following monetary policy:
The Fed sells $ million worth of US Treasury bonds.
Question options:
a
Increases excess reserves and the money supply.
b
Decreases excess reserves and the money supply.
c
Does not change the reserves or the money supply.
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