Increases in which of the following items from the Fed's balance sheet will result in increases in the monetary base?
A)U.S. Treasury deposits
B)Discount loans
C)Other Federal Reserve liabilities and capital account
D)Foreign and other deposits

Question

Quizplus · Accepted Answer

Discount loans increase the monetary base because when the Federal Reserve lends to financial institutions through its discount window, it directly increases the reserves those institutions hold at the Fed, thus expanding the monetary base.

Increases in Which of the Following Items from the Fed's