Which of the Following Actions by the Fed Would Increase

question 65

Multiple Choice

Which of the following actions by the Fed would increase the money supply?

• A) reducing the required reserve ratio
• B) selling government bonds in the open market
• C) increasing the discount rate
• D) increasing the income tax rate

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Definitions:

Self-Fulfilling Prophecy

A phenomenon where an individual's or group's expectation of an outcome causes the outcome to occur, reinforcing the original expectation.

Negative Results

Outcomes that are detrimental, opposite of intended, or do not meet the expected or desired objectives.

Positive Results

Beneficial outcomes or achievements that stem from specific actions, measures, or experiments.

Emotional Arousal

A state of heightened physiological and emotional response to stimuli, which can influence behavior and perception.