Which of the following lists two things that both decrease 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 sales means that the Federal Reserve is selling securities, which decreases the money supply. Raising the reserve requirement ratio means that banks are required to hold a higher percentage of deposits in reserve, which restricts the amount of money that can be lent out and also decreases the money supply.

Which of the Following Lists Two Things That Both Decrease