When the Federal Reserve calls in a discount loan from a bank, the monetary base ________ and reserves ________.

When the Federal Reserve calls in a discount loan from a bank, the monetary base ________ and reserves ________.

When the Federal Reserve calls in a discount loan from a bank, the monetary base ________ and reserves ________.




A) remains unchanged; decrease
B) remains unchanged; increase
C) decreases; decrease
D) decreases; remains unchanged



Answer: C