If the Bank of Canada Buys Government Securities from the Chartered

Multiple Choice

If the Bank of Canada buys government securities from the chartered banks, which of the following transactions take place?

A) The demand deposits of chartered banks are unchanged, but their reserves increase.
B) The demand deposits and reserves of chartered banks both decrease.
C) The demand deposits of chartered banks are unchanged, but their reserves decrease.
D) The demand deposits and reserves of chartered banks are both unchanged.