The Chair of the Federal Reserve Bank Spoke to the American

Multiple Choice

The chair of the Federal Reserve Bank spoke to the American public. The message she conveyed is that Fed economists are worried about inflation and believe the best course of action would be to slow the economy. Which of the following policies is the Fed most likely to pursue?

A) Increase taxes
B) Decrease interest rates
C) Restrict the money supply and increase interest rates
D) Devalue the dollar on international currency exchanges