If the Federal Reserve increases the reserve requirement, what effect will this have on the nation's money supply? a. Increase the money supply. c. Have no effect on the money supply. b. Decrease the money supply. d. It will double the nation's money supply.

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Kaiya Cook

7 July, 08:36

If the Federal Reserve increases the reserve requirement, what effect will this have on the nation's money supply? a. Increase the money supply. c. Have no effect on the money supply. b. Decrease the money supply. d. It will double the nation's money supply.

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Answers (2)

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Bobby · Answer 1

B. Decrease the money supply

Macie Lin · Answer 2

If the Federal Reserve increases the reserve requirement, the nation's money supply will decrease. This is because there would be less money being spent in the general economy.