Cash I important to the overall money supply because cash helps the banks to increase the money supply buy giving loans with an interest rate to increase the flow of money back into the bank. As well without cash you could not have credit or debit cards which would collapse the overall money supply.
The Federal Reserve Board and the Federal government are related because they both use the open market to increase or decrease the money supply. By selling bonds to the public the money supply will decrease on the other hand if they buy bonds they will increase the money supply.
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