Complete the sentences with the correct terms. Some terms may be used more than once, and some may not be used at all. You are currently in a labeling module. Turn off browse mode or quick nav, Tab to items, Space or Enter to pick up, Tab to move, Space or Enter to drop. The Fed controls the money supply through open market operations. For instance, when the Fed buys bonds, this in demand for bonds causes nominal interest rates to . When the Fed buys bonds, bank reserves , which reduces the need for banks to borrow. This causes the federal funds rate to . Answer Bank