Which of the following would cause the money supply in the United States to decrease?
A) an increase in reserve requirements
B) a decrease in the discount rate
C) a purchase of U.S. government bonds by the Federal Reserve
D) an increase in the world supply of gold

Question

Quizplus · Accepted Answer

An increase in reserve requirements means that banks have to hold more reserves, which decreases the amount of money they can lend out, therefore decreasing the money supply in the economy.

Which of the Following Would Cause the Money Supply in the United