Suppose the central bank purchases a government bond from a person who deposits the entire amount received from the sale in her bank the money supply will ?
Found an error? Read our corrections policy and report it in the comments below.
A. fall by exactly the amount of the deposit as long as the bank does not change its reserve ratio
B. fall by exactly the amount of the deposit as long as the bank does not change its reserve ratio
C. be unchanged
E. rise by less than the amount of the deposit
Found an error? Read our corrections policy and report it in the comments below.