to decrease the money supply, the fed can\nbuy government bonds or increase the discount rate.\nbuy…

Brief Explanations:

When the Fed sells government bonds, it takes money out of the hands of the public, reducing the money - supply. Increasing the discount rate makes it more expensive for banks to borrow from the Fed, so banks will borrow less and lend less, also reducing the money - supply. Buying government bonds injects money into the economy and decreasing the discount rate encourages more borrowing and lending, increasing the money - supply.

Answer:

C. sell government bonds or increase the discount rate.