Which of the following is true?

a) When the Fed sells government bonds, the monetary base will increase.

b) If the Fed decreases the interest it pays on banks' reserves, we may expect an increase in the money supply.

c) None of the other answers is correct.

d) Cash in bank vaults is part of M1.

Which of the following is true?

a) All else equal, a decrease in the currency-deposit ratio will decrease the money multiplier and so the money supply.

b) None of the other answers is correct.

c) The monetary base equals the sum of currency and deposits.

d) If bank's assets decrease while bank's liabilities stay the same, then the bank's leverage ratio (defined as the equity multiplier) will decrease.