If the Treasury purchases a new computer system and pays the computer vendor with a check for $100,000 drawn on the Treasury's account with the Fed,
A)the reserves of the banking system will fall by $100,000.
B)the Fed's assets will increase by $100,000.
C)the Fed's liabilities will increase by $100,000.
D)the monetary base will increase by $100,000.

Question

Quizplus · Accepted Answer

The Answer of If the Treasury purchases a new computer system and pays the computer vendor with a check for $100,000 drawn on the Treasury's account with the Fed,
A)the reserves of the banking system will fall by $100,000.
B)the Fed's assets will increase by $100,000.
C)the Fed's liabilities will increase by $100,000.
D)the monetary base will increase by $100,000.

If the Treasury Purchases a New Computer System and Pays