Which of the following lists two things that both increase the money supply?
A)make open market purchases, raise the reserve requirement ratio
B)make open market purchases, lower the reserve requirement ratio
C)make open market sales, raise the reserve requirement ratio
D)make open market sales, lower the reserve requirement ratio

Question

Quizplus · Accepted Answer

Making open market purchases injects more money into the economy by increasing the reserves of banks, while lowering the reserve requirement ratio allows banks to lend out more money, thus increasing the money supply. Both actions work to increase the money supply.

Which of the Following Lists Two Things That Both Increase