Would reinvest the funds by buying us treasury securities

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Reference no: EM131303138

In August 2010, the Federal Reserve announced that as the mortgage-backed securities it owns matured, it would reinvest the funds by buying U.S. Treasury securities.

What impact would these actions have on the size of the Fed's balance sheet?

Would the Fed be more likely to take this action if it saw future U.S. economic growth as being strong or as being weak? Briefly explain.

Reference no: EM131303138

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