When cash is deposited in a checking account, the reserves of commercial banks are increased.

The larger the margin requirement, the greater the proportion of a stock purchase the investor may borrow.

If deposits are withdrawn from a commercial bank, it may obtain reserves by

If an investment banker makes a best efforts agreement to sell 1,200,000 shares at $10 a share, the investment banker must sell at least 200,000 shares.

During a period of recession, the Fed sells securities.

When the Federal Reserve sells securities that are purchased by individuals, the money supply is increased.

If an individual buys stock on margin and its price rises, the investor must

In a best efforts agreement to sell new securities, the firm issuing the securities agrees to make the best effort to sell the securities.

The market in which securities are initially sold to the general public is the secondary market.

Since M2 excludes time deposits, M2 is a less comprehensive measure of the money supply than M1.