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Question
Comparing the effect on the monetary base between an open market purchase of government securities from a bank and the same open market operation conducted with the general public, the monetary baseA) increases by a larger amount if the general public sells the securities than if a bank sells the securities.
B) increases by a larger amount if a bank sells the securities than if the general public sells the securities.
C) does not change if it is the general public that sells the securities.
D) increases by the same amount if the general public sells the securities or if a bank sells the securities.
E) decreases by the same amount if the general public sells the securities or if a bank sells the securities.
Answer
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