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

Question

Quizplus · Accepted Answer

Open market sales decrease the money supply by selling government securities, which takes money out of circulation. Raising the reserve requirement ratio decreases the money supply by requiring banks to hold more reserves, reducing the amount they can lend out.

Which of the Following Lists Two Things That Both Decrease