Why aren't Treasury deposits with the Fed part of the monetary base?
A)Because they are currency and currency is not included in the monetary base
B)Because no deposits at the Fed are included in the monetary base
C)Because they aren't assets of either the nonbank public or banks
D)Because the Fed is unable to exercise effective control over their size

Question

Quizplus · Accepted Answer

The monetary base comprises currency in circulation with the nonbank public and bank reserves held at the Federal Reserve. Treasury deposits with the Fed are not assets of either the nonbank public or banks and hence are not included in the monetary base.

Why Aren't Treasury Deposits with the Fed Part of the Monetary