Which of the following lists two things that both decrease the money supply?
A)lower the discount rate and raise the reserve requirement ratio
B)lower the discount rate and lower the reserve requirement ratio
C)raise the discount rate and raise the reserve requirement ratio
D)raise the discount rate and lower the reserve requirement ratio

Question

Quizplus · Accepted Answer

Raising the discount rate makes borrowing more expensive for banks, reducing the money supply. Raising the reserve requirement ratio means banks must hold more reserves and can lend less, also decreasing the money supply.

Which of the Following Lists Two Things That Both Decrease