Which of the Following Is Not a Consequence of the Fed

Multiple Choice

Which of the following is not a consequence of the Fed changing the required reserve ratio?

A) Changes in the ratio are easily incorporated into banks' routine management.
B) Decreasing the ratio will increase excess reserves.
C) Increasing the ratio will decrease the amount of reserves banks have to loan.
D) Changes in the ratio effectively places a tax on banks' deposit taking and lending activities.