Which of the following actions of the Fed will increase money supply in the U.S.directly?
A)Purchase U.S.government bonds
B)Increase the federal funds rate
C)Increase the reserve requirement
D)Increase the discount rate
E)Ban sales of private mutual funds

Question

Quizplus · Accepted Answer

When the Fed purchases U.S. government bonds, it injects money into the economy, thereby increasing the money supply. This is known as Open Market Operations.

Answer: None of the others 
 Increasing the federal funds rate, increasing the reserve requirement, increasing the discount rate, and banning sales of private mutual funds all have the opposite effect of decreasing the money supply in the economy.

Which of the Following Actions of the Fed Will Increase