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    Macroeconomics Study Set 39
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    Exam 4: The Monetary System: What It Is and How It Works
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    When the Fed Increases the Discount Rate, It
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When the Fed Increases the Discount Rate, It

Question 79

Question 79

Multiple Choice

When the Fed increases the discount rate, it:


A) increases the reserve to deposit ratio (rr) .
B) decreases the reserve to deposit ratio (rr) .
C) is likely to increase the monetary base (B)
D) is likely to decrease the monetary base (B) .

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