To increase the money supply,the Fed might:

Question

Quizplus · Accepted Answer

To increase the money supply, the Fed needs to implement expansionary monetary policy. This can be done by either decreasing the reserve requirement or buying bonds in the open market. Option B includes both of these actions, making it the best choice. Increasing the discount rate or increasing the reserve requirement would both decrease the money supply, while selling government securities and increasing the discount rate have mixed effects on the money supply.

To Increase the Money Supply,the Fed Might