Assume that the required reserve ratio is 20 percent and that the Fed engages in an open market purchase of $1,000 of government securities. The central bank buys $1,000 of government securities only from commercial banks. The maximum change in excess reserves, banking system loans, and the total money supply will be Excess Reserves Banking System Loans Total Money Supply Multiple choice question. A) $ 1,000 $ 5,000 $ 5,000 B) $ 1,000 $ -4,000 $ -5,000 C) $ 200 $ 800 $ 1,000 D) $ 0 $ -5,000 $ -1,000 E) $800 $ 4,000 $ 5,000

i would say a certificate of deposit, so you're not locked into a long term, and it has more security than a mutual fund.

the answer is "b.the increased supply will create a surplus. "

the essential thought behind price controls is straightforward - utilize the power of law to modify the equilibrium of a market. for instance, the legislature may choose that the steel business needs to survive, and in this way pass a law to set a value floor on steel. this implies all steel sold must offer at or over the floor value, which must be set over the equilibrium cost for it to have any impact. the switch could likewise happen - the administration can choose that steel is excessively costly and set a value roof underneath its equilibrium value, with the goal that all steel must be sold at or beneath that ceiling.