The Federal Reserve Bank regulates the money supply by__________________?
Correct answer: D. all of the above
- A. establishing minimum reserve requirements of member banks
- B. the discount rate it charges member banks
- C. buying and selling government securities
- D. all of the above
Explanation
The Federal Reserve influences money creation through reserve requirements, the discount rate, and open-market purchases or sales of government securities. Therefore, all three listed instruments are valid.
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