Use the Figure Below to Answer the Following Question(s)

question 110

Multiple Choice

Use the figure below to answer the following question(s) .
Figure 14-2

-If the Fed anticipates that the conditions illustrated by AD₂ and SRAS in Figure 14-2 will be present in the near future,it should

• A)decrease the discount rate.
• B)reduce reserve requirements.
• C)sell U.S.treasury bonds on the open market.
• D)buy U.S.treasury bonds on the open market.