If the Fed Wanted to Shift to a More Restrictive

Multiple Choice

If the Fed wanted to shift to a more restrictive monetary policy, it would

A) expand the reserves available to the banking system, which would drive down short term interest rates.
B) reduce the reserves available to the banking system, which would drive down short term interest rates.
C) expand the reserves available to the banking system, which would drive up short term interest rates.
D) reduce the reserves available to the banking system, which would drive up short term interest rates.