At One Time,people in a Certain Country Had No Access

question 28

Multiple Choice

At one time,people in a certain country had no access to banks;they relied exclusively on currency.Then,a fractional-reserve banking system was created.As a result,the money supply

• A)increased.The central bank could have reduced the size of this increase by buying bonds.
• B)increased.The central bank could have reduced the size of this increase by selling bonds.
• C)decreased.The central bank could have reduced the size of this decrease by buying bonds.
• D)decreased.The central bank could have reduced the size of this decrease by selling bonds.