If the Fed Wanted to Act to Increase Borrowing by Firms

question 55

Multiple Choice

If the Fed wanted to act to increase borrowing by firms and consumers and thus hopefully reduce unemployment,it would

• A)sell securities.
• B)raise the reserve rate.
• C)decrease the interest rate on loans to member banks.
• D)increase the interest rate on loans to member banks.
• E)encourage people to save more and spend less.

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Definitions:

Timid Politics

A form of political action characterized by hesitance, caution, or a lack of boldness in policy-making and leadership.

American Way

A phrase referring to the unique cultural and social norms, values, and ideals that are perceived to characterize the United States.

Bankers And Businesses

Entities involved in managing and investing money, as well as entities running for-profit ventures.