To Signal Its Intention to Restrict Credit Availability, the Federal

question 58

Multiple Choice

To signal its intention to restrict credit availability, the Federal Reserve could

• A)increases the discount rate.
• B)pushes the discount rate below the Federal Funds rate.
• C)keeps the discount rate equal to the Federal Funds rate.
• D)reduces the discount rate by ¼ of a percentage point.

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Definitions:

Placebo Effect

A phenomenon in which a person experiences a physical or psychological improvement after taking a substance with no therapeutic effect.

Diagnostic Test

Procedures used to identify and determine the cause of disease or disorder in an individual.

Anxiety Disorder

A category of mental health disorders characterized by significant and persistent worry and fear that interfere with daily activities.

Cognitive Therapies

A type of psychotherapy that focuses on changing unhelpful or negative thought patterns to improve emotional regulation and cope with mental health issues.