2. Which are the three channels by which the Federal Reserve can reduce money su

Question

2. Which are the three channels by which the Federal Reserve can reduce money supply?
a. Buy government securities, lower reserve requirements, and lower the discount rate
b. Buy government securities, raise reserve requirements, and raise the discount rate
c. Buy government securities, lower reserve requirements, and raise the discount rate
d. Sell government securities, raise reserve requirements, and raise the discount rate
e. Sell government securities, lower reserve requirements, and raise the discount rate

Explanation / Answer

c. Buy government securities, lower reserve requirements, and raise the discount rate

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