Question

Which action taken by a central bank would reflect expansionary monetary

policy?
A. Raising the interest that it pays to banks on the balance of their
reserves
B. Raising the discount rate to provide less in loans to banks
C. Lowering the reserve requirements for all banks
O D. Selling treasury securities to banks to reduce the money supply

Answer 1

Lowering the reserve requirements for all banks reflects expansionary monetary policy.

Step-by-step explanation:

The action taken by a central bank that reflects expansionary monetary policy is lowering the reserve requirements for all banks. When the central bank lowers the reserve requirements, banks are required to hold less money in reserves and can therefore lend more money to businesses and individuals. This increases the money supply and stimulates economic activity.

Answer 2

C. Lowering the reserve requirements for all banks

Step-by-step explanation:

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