1) In 2014, the European Central Bank took the unusual step of:

a. setting negative interest rates.

b. dissolving the euro as a common currency.

c. raising interest rates during a recession.

d. returning to the gold standard.

2) If the Board of Governors of the Federal Reserve System decreases the legal reserve ratio, this change will:

a. increase the excess reserves of member banks and thus decrease the money supply.

b. increase the excess reserves of member banks and thus increase the money supply.

c. decrease the excess reserves of member banks and thus decrease the money supply.

d. decrease the excess reserves of member banks and thus increase the money supply.