Question 1 9 pts BankA lends $8 million to bank B so that bank B can maintain its required reserve: Suppose required reserve ratio at 5%. a. What happens to the reserve in banking system? lnereasegdecreasegremains the same. [2 points] b. Does money supply change? If so. by how much? [2 points) Bank B borrows $3 million from the Fed. Required reserve ratio is still set at 5%. c. What happens to the reserve in bank B? [2 points] d. Does money supply change? If so. by how much? [3 points) Question 2 9 pts List the three major monetary policy tools the Federal Reserve can use to decrease money supply. Explain why such action would decrease the money supply. Tool 1: (1 point) How would the tool be used: (2 points) Tool 2: (1 point) How would the tool be used: (2 points) Tool 3: (1point) How would the tool be used: (2 point)