When the Fed raises the reserve requirement, the _____ of reserves shifts to the
A) demand, right.
B) demand, left.
C) supply, right.
D) supply, left.

Question

Quizplus · Accepted Answer

When the Fed raises the reserve requirement, the supply of reserves shifts to the left. This is because banks are required to hold a higher percentage of their deposits as reserves, which reduces the amount of reserves available to lend out.

When the Fed Raises the Reserve Requirement, the _____ of Reserves