Question

If the fed buys $1 million in government securities from bank a, then the immediate effect of this transaction is an increase in?

Answer 1

  If the fed buys $1 million in government securities from bank a, then the immediate effect of this transaction is an increase in Bank A's excess reserves

The word bank has many meanings. Apart from things related to money such as savings banks and piggy banks, banks are also grass and dirt slopes such as riverbanks.

Banks, institutions that trade money and its substitutes and provide other money-related services. In their function as financial intermediaries, banks accept deposits and authorize loans.

Steal the key. A bank is a financial institution authorized to accept deposits and make loans. There are different types of banks such as retail banks, commercial banks, and investment banks. In most countries, banks are regulated by central governments or central banks.

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