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Which of the following monetary policy tools will NOT affect the total reserves available in the banking system?

changeing the discount rate

using repos or reverse repos

buying or selling bonds

reserve requirement

1 Answer

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Answer:

Changing the discount rate will not affect the total reserves available in the banking system.

Step-by-step explanation:

The discount rate is the interest rate that the Federal Reserve charges banks to borrow money. By changing the discount rate, the Federal Reserve can influence the cost of borrowing for banks and, in turn, the interest rates that banks charge their customers. However, changing the discount rate does not directly affect the total reserves available in the banking system. Conversely, the other monetary policy tools listed (repos or reverse repos, buying or selling bonds, and reserve requirements) do affect the total reserves available in the banking system.

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