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    What would be the effect of increasing the reserve requirements of banks on the money supply?

    An increase in reserve requirements would reduce the supply of money, since more money would be held in banks rather than circulating in the economy.

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Source:  OpenStax, University of houston downtown: macroeconomics. OpenStax CNX. May 28, 2014 Download for free at http://legacy.cnx.org/content/col11653/1.3
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