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  • 02-05-2018
  • Social Studies
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How does the Federal Reserve reduce the money supply in the economy?

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Hollycx Hollycx
  • 02-05-2018
If the Fed buys back issued securities (such as Treasury bills) from large banks and securities dealers, it increases the money supply in the hands of the public. Conversely, the money supply decreases when the Fed sells a security.
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