coledevo coledevo
  • 04-09-2017
  • Social Studies
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How does banking affect the money supply?

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mandy76
mandy76 mandy76
  • 04-09-2017
Central banks affect the quantity of money in circulation by buying or selling government securities through the process known as open market operations. When a central bank is looking to increase the quantity of money in circulation it purchases government securities from commercial banks and institutions.
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