Multiple Choice
Which of the following describes the chain of events the Fed uses to fight recession?
A) Raise the federal funds rate target, sell government securities, decrease reserves and loans, increase aggregate demand.
B) Raise the federal funds rate target, buy government securities, increase reserves and loans, decrease aggregate demand.
C) Lower the federal funds rate target, buy government securities, decrease reserves and loans, decrease aggregate demand.
D) Lower the federal funds rate target, buy government securities, increase reserves and loans, increase aggregate demand.
Correct Answer:
Verified
Correct Answer:
Verified
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