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When the Fed buys bonds from financial institutions, new money moves directly Group of answer choices

1 Answer

4 votes

Answer:

out of the loanable funds market.

Step-by-step explanation:

In the case when the Fed purchased bonds from a financial institution so the new money shift directly out of the funds market i.e. lonable because the bank reserve would increased also they begins lending at lesser rate of interest

Therefore as per the given situation, the fourth option is correct

And, the same is relevant

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