Question: Explain the effect on the demand for reserves or the supply of reserves of the following Fed policy action: An increase in the required reserve

Explain the effect on the demand for reserves or the supply of reserves of the following Fed policy action: An increase in the required reserve ratio. A. This would lower the interest rate at which the supply for reserves becomes horizontal. B. This would increase the demand for reserves. C. This would lower the interest rate at which the demand curve becomes horizontal. D. This would raise the interest rate at which the supply for reserves becomes horizontal

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