Question

Which of the following accurately describes how lowering the required

reserve ratio increases the money supply?
O A. When the required reserve ratio is lowered, banks make less profit
on money loaned out.
B. When the required reserve ratio is lowered, the inflation rate goes
up and people spend less money.
C. When the required reserve ratio is lowered, banks charge lower
interest rates that make loans more affordable.
D. When the required reserve ratio is lowered, banks can loan out
more money​

Answer 1

When the required reserve ratio is lowered, banks can loan out more money

Step-by-step explanation:

Answer 2

D. When the required reserve ratio is lowered, banks can loan out more money.

Step-by-step explanation:

This is a concept which deals with how If the Federal Reserve decides to lower the reserve ratio for some reasons, the commercial banks around our nation are required to keep low amounts of cash at their disposal which means banks can loan out more money to consumers and businesses.