Suppose the Fed purchases $5 billion worth of government bonds from Bill Gates, who banks at the
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Suppose the Fed purchases $5 billion worth of government bonds from Bill Gates, who banks at the Bank of America in San Francisco. Show the effects on the balance sheets of the Fed, the Bank of America, and Gates. Does it make any difference if the Fed buys bonds from a bank or an individual?
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All figures are in billions of dollars The Fed simply creates the 5 billion in the form of ba...View the full answer
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Related Book For
Macroeconomics Principles And Policy
ISBN: 9780324586213
11th Edition
Authors: William J. Baumol, Alan S. Blinder
Question Posted:
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