Which of the following best explains why the money supply is increased when
the Fed buys T-bonds on the open market?

A. The purchase of bonds leads to a reduction in the discount rate, which
provides banks with an incentive to loan more money

B. The purchase of bonds reduces the available supply of bonds, which
drives up bond prices

C. The purchase of bonds increases the demand both for bonds purchases
and for money in general

D. The purchase of bonds increases the amount of deposits in people's
bank accounts, which enables banks to loan more money