Which of the Following Measures Would Decrease the Money Supply

question 129

Multiple Choice

Which of the following measures would decrease the money supply?

• A) increasing the reserve requirement
• B) decreasing the discount rate
• C) buying government bonds
• D) decreasing the federal funds rate

---

Definitions:

Fixed Manufacturing Overhead

Costs in manufacturing that do not vary with the level of production, such as rent, depreciation, and salaries.

Inventories

Assets held for sale in the ordinary course of business, in the process of production for such sale, or in the form of materials to be consumed in the production process.

Deferred

Refers to expenses or income that has been incurred but not yet recognized in the accounts, to be recognized in a future period.

Released

Refers to a product or information that has been made available to the public or to a specific group.