Business, 16.04.2020 21:11, maddie6610

The federal system (the fed) buys a U. S. government treasury bond from Alice for $1000. Alice deposits the $1000 into a checking account at Arbor National Bank. The required reserve ratio on checking accounts is 20 percent. The Fed's transaction (buying bond) would lead to (a decrease, an increase, no change( in the monetary base. The maximum dollar amount of new money that can be created by the banking system and the fed combined is ($1000, $1800, $4000, $4800, $5000, $5800).

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The federal system (the fed) buys a U. S. government treasury bond from Alice for $1000. Alice depos...