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If the federal reserve sells $40,000 in treasury bonds to a bank at 5% interest, what is the immediate effect on the money supply?

If the federal reserve sells $40,000 in treasury bonds to a bank at 5% interest, what is the immediate effect on the money supply?
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If the federal reserve sells $40,000 in treasury bonds to a bank at 5% interest, what is the immediate effect on the money supply?

User Hobo
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1 Answer

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The money supply is decreased by $40,000

User Kaveesh Kanwal
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