Which of the Following Would Constitute Contractionary Monetary Policy by the Fed

question 155

Multiple Choice

Which of the following would constitute contractionary monetary policy by the Fed?

• A)​An increase in income tax rates, a cut in government spending, and an elimination of the investment tax credit
• B)​Open market sales of government securities, an increase in the discount rate, and an increase in reserve requirements
• C)​An increase in tariffs on imported goods and a decrease in foreign aid
• D)​Open market purchases of government securities, a cut in the discount rate, and an increase in reserve requirements

---

Definitions:

Analyzing Bids

The process of reviewing and comparing proposals from vendors or contractors to select the best option.

Due Diligence

It involves a comprehensive appraisal or investigation conducted to establish the assets, liabilities, and commercial potential of a business entity before financial transactions or agreements.

Transactional Work

Tasks or jobs that involve routine and standard processes where the input-output relationship is relatively direct and predictable.

Management's Time

Refers to how managers allocate their working hours among various tasks and responsibilities to effectively run an organization.