If Businesses React to a Pessimistic Outlook and Decrease Spending

Multiple Choice

If businesses react to a pessimistic outlook and decrease spending, the Fed can counteract this by

A) decreasing money supply to spur the economy out of the recession.
B) increasing money supply, lowering real interest rates, and encouraging borrowing.
C) increasing government expenditures to spur the economy out of the recession.
D) decreasing corporate taxes to encourage firms to increase their spending.