Yes, the operation will result in a decrease in the monetary base of 3367. To understand why, we need to first define some terms: - Reserve: The amount of money that banks are required to hold in reserve against their deposits. - Monetary base: The total amount of currency in circulation plus the reserves held by banks. - Deposit ratio: The ratio of deposits to reserves that banks are required to hold. Now, let's look at the scenario presented in the question. The central bank buys 1000 bonds in the open market, which means it is injecting 1000 into the economy. However, this injection of funds does not directly increase the monetary base. Instead, it increases the reserves held by banks. Assuming a reserve-deposit ratio of 20%, this means that banks are required to hold 20% of their deposits in reserve. So, if the central bank injects 1000 into the economy, banks will hold 200 of that as reserves. However, the effective-deposit ratio is only 10%, which means that banks are actually holding 10% of their deposits in reserve. This means that banks will only hold 100 of the 1000 injected by the central bank as reserves. So, the increase in reserves will be 100, which means that the monetary base will decrease by the same amount. Therefore, the operation will result in a decrease in the monetary base of 3367.