Which of the following would likely increase the money supply?

A) The purchase of government securities by one bank from another bank
B) An increase in the required reserve ratio
C) An increase in the reserves of a commercial bank
D) An increase in the discount rate
E) The sale of government securities by a bank to the Fed

Money Supply

The total amount of money—cash, coins, and balances in bank accounts—in circulation within a country's economy at a specific time.

Required Reserve Ratio

The fraction of deposits that banks are required to keep on hand and not lend out, as set by the central bank.

Discount Rate

The interest rate charged to commercial banks and other depository institutions on loans they receive from their regional Federal Reserve Bank's lending facility.