When the Fed buys government securities, it:
A. Lowers the cost of borrowing from the Fed, encouraging banks to make loans to the general public.
B. Decreases the amount of excess reserves that banks hold, discouraging them from making loans to the general public.
C. Increases the amount of excess reserves that banks hold, encouraging them to makes loans to the general public.
D. Increases the amount of excess reserves that banks hold, discouraging them from making loans to the general public.
E. Raises the cost of borrowing from the Fed, discouraging banks from making loans to the general public.