Which of the following would cause the U.S. money supply to expand?

Question

Quizplus · Accepted Answer

A decrease in reserve requirements would allow commercial banks to lend out more of their deposits, which would increase the money supply.

Answer: B
 When a commercial bank purchases U.S. securities from the Fed, the Fed credits the bank's reserve account with additional reserves, which increases the bank's ability to make loans and therefore increases the money supply.

Which of the Following Would Cause the U