# Answer to Question #75578 in Macroeconomics for breshay

Question #75578

The Fed buys $5,000 of government securities. The required reserve ratio is 15%. Banks hold no excess reserves and there is no currency drain i.e. there are no leakages in the banking system.

(A) As a result money supply will

A.

increase

B.

decrease

by $

nothing

. (Enter a numerical value here. Approximate your answer to a whole number.)

(A) As a result money supply will

A.

increase

B.

decrease

by $

nothing

. (Enter a numerical value here. Approximate your answer to a whole number.)

Expert's answer

(A) As a result money supply will

A.

increase

B.

decrease

by $

nothing

. (Enter a numerical value here. Approximate your answer to a whole number.)

Answer: a

5000/0.15=$ 33333

A.

increase

B.

decrease

by $

nothing

. (Enter a numerical value here. Approximate your answer to a whole number.)

Answer: a

5000/0.15=$ 33333

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