If the reserve requirement is 25 percent and banks hold no excess
reserves, an open market sale of $400,000 of government securities
by the Federal Reserve will
(A) increase the money supply by up to $1.6 million
(B) decrease the money supply by up to $1.6 million
(C) increase the money supply by up to $300,000
TB) increase the money supply by up to $100,000
(E) decrease the money supply by up to $100,000
expans