As a result of the transactions listed below, describe what is likely to happen to interest rates, deposits, and total bank reserves :
a. The Federal Reserve sells $21 million in securities from its own portfolio to a foreign central bank.
b. The Federal Reserve buys $37 million in securities for its own portfolio that are being offered for sale by a foreign central bank.
c. The Federal Reserve declines the U.S. Treasury's offer to roll over $150 million in Treasury notes that are maturing in the Fed's own portfolio in exchange for new Treasury notes; instead the Federal Reserve demands cash from the Treasury.

Question

As a result of the transactions listed below, describe what is likely to happen to interest rates, deposits, and total bank reserves :
a. The Federal Reserve sells $21 million in securities from its own portfolio to a foreign central bank.
b. The Federal Reserve buys $37 million in securities for its own portfolio that are being offered for sale by a foreign central bank. 
c. The Federal Reserve declines the U.S. Treasury's offer to roll over $150 million in Treasury notes that are maturing in the Fed's own portfolio in exchange for new Treasury notes; instead the Federal Reserve demands cash from the Treasury.

Quizplus · Accepted Answer

The Answer of As a result of the transactions listed below, describe what is likely to happen to interest rates, deposits, and total bank reserves :
a. The Federal Reserve sells $21 million in securities from its own portfolio to a foreign central bank.
b. The Federal Reserve buys $37 million in securities for its own portfolio that are being offered for sale by a foreign central bank. 
c. The Federal Reserve declines the U.S. Treasury's offer to roll over $150 million in Treasury notes that are maturing in the Fed's own portfolio in exchange for new Treasury notes; instead the Federal Reserve demands cash from the Treasury.

As a Result of the Transactions Listed Below, Describe What