If total Fed assets __________, then reserves have to __________, everything else being equal.
A) fall; rise
B) rise; fall
C) fall; fall
D) None of the above.

Question

Quizplus · Accepted Answer

When total Federal Reserve (Fed) assets fall, it typically means the Fed is selling securities or engaging in contractionary monetary policy, which leads to a decrease in bank reserves as banks or other entities pay for these securities, effectively reducing the amount of money banks have available to lend or hold in reserve.

If Total Fed Assets __________, Then Reserves Have to __________

If Total Fed Assets , Then Reserves Have to