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If Mary takes money from her savings account and buys a T-bond from Jody with that money, it's:

A. An expansionary fiscal policy.
B. An example of contractionary monetary policy.
C. An example of expansionary monetary policy
D. An example of neutral (neither expansionary nor contractionary) policy.
E. The same as the Fed buying bonds.

do some research, then take a shot. What do you think? Hint: be sure to think about bank reserves and reserve requirements.

  • Economics -

    you stupids, its E.

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