Which of the Following Is an Approach Used by the Fed

question 20

Multiple Choice

Which of the following is an approach used by the Fed to lessen the likelihood of inflation?

• A)Lower the reserve requirement for banks so they can loan out more money.
• B)Raise the discount rate charged to banks that borrow funds from the Fed.
• C)Buy bonds on the open market to increase the amount of money banks have to lend.
• D)Lower the federal funds rate charged to banks who want to borrow from other banks.

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Definitions:

Reciprocal Alliances

Partnerships or agreements between parties that involve mutual benefits or exchanges.

Informal Systems

Unofficial methods and processes that develop within an organization, allowing it to function smoothly outside of formal structures.

Political Savvy

Political savvy is knowing how to negotiate, persuade, and deal with people regarding goals they will accept.

Political Environments

Refers to the political context within which an organization operates, including laws, government policies, and the influence of political actors.