Question

If the Fed increases the discount rate, which of the following accurately describes the system, finally leading to a decline in money supply?

A. Excess reserves j: Reserves: Coans J: Deposits : Money supply
B. Reserves J: Excess reserves J: Loans J: Deposits ;Money supply
C LoansJ:DepositsJ:Reserves J:Excess reserves |: Money supply
D. Deposits J: ReservesJ:Excess reservesI:Loans J:Money'supply

Answer 1

B

Step-by-step explanation:

Reserves J: Excess reserves J: Loans J: Deposits ;Money supply