If the Fed wants to expand the money supply, why is it more likely to do so by purchasing bonds and other financial assets rather than by lowering reserve requirements?
Are the following statements true or false?
a. “You can never have too much money.”
b. “When you deposit currency in a commercial bank, cash goes out of circulation and the money supply declines.”
c. “If the Fed would create more money, Americans would achieve a higher standard of living.”