Which List Contains Only Actions That Decrease the Money Supply

question 152

Multiple Choice

Which list contains only actions that decrease the money supply?

• A) lowering the bank rate; raising the reserve requirement ratio
• B) lowering the bank rate; lowering the reserve requirement ratio
• C) raising the bank rate; raising the reserve requirement ratio
• D) raising the bank rate; lowering the reserve requirement ratio

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Definitions:

Cheques

Written, dated, and signed instruments that direct a bank to pay a specific sum of money to the bearer or a specified person.

Deposits

Funds placed into an account at a banking institution for safekeeping, which can include money market accounts, savings accounts, and certificates of deposit.

Outstanding

Refers to shares that are currently held by investors, including both public shareholders and restricted company shares.

Adjusted Bank Balance

The bank account balance after accounting for transactions like outstanding checks and deposits in transit.