Between 12008 and 122009 the monetary base of the Federal Re

Between 1/2008 and 12/2009 the monetary base of the Federal Reserve System increased from $1 trillion US. dollars to $3 trillion US dollars. T or F?

Solution

The given statement is TRUE

Explanation: As we all know there was a financial crisis in the United States in 2008 and 2009 which was famously called sub-prime crisis. As a result, the economy went into recession. The US Fed then started injecting Money into the economy so as to keep liquidity at high levels. Hence the Monetary base increased from 1 trillion to 3 trillion in those years.