Suppose the Fed engages in open market sales but the federal funds rate remains unchanged. What could be going on in the
Posted: Thu May 19, 2022 8:05 am
Suppose the Fed engages in open market sales but the federal
funds rate remains unchanged. What could be going on in the
reserve market?
A.
It could be the case that the supply curve currently intersects
the demand curve at the section where the demand curve is
horizontal
B.
None of these are reasonable explanations
C.
It could be the case that the US treasury department engaged in
open market purchases at the same time
D.
It could be the case that the supply curve currently intersects
the demand curve at the section where the demand curve is downward
sloping
funds rate remains unchanged. What could be going on in the
reserve market?
A.
It could be the case that the supply curve currently intersects
the demand curve at the section where the demand curve is
horizontal
B.
None of these are reasonable explanations
C.
It could be the case that the US treasury department engaged in
open market purchases at the same time
D.
It could be the case that the supply curve currently intersects
the demand curve at the section where the demand curve is downward
sloping