To increase the money supply, the Fed can a. buy government bonds or increase th

Q: To increase the money supply, the Fed can a. buy government bonds or increase th

Correct Answer: B The Federal Reserve buys the government securities and injects money into the market. Besides, the lowering of the interest rate, also increases the consumption as well as investment spending in the economy. So, economy is stimulated.

ID: 2428875 • Letter: T

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To increase the money supply, the Fed can a. buy government bonds or increase the discount rate. b. buy government bonds or decrease the discount rate. c. sell government bonds or increase the discount rate. d. sell government bonds or decrease the discount rate.
To increase the money supply, the Fed can a. buy government bonds or increase the discount rate. b. buy government bonds or decrease the discount rate. c. sell government bonds or increase the discount rate. d. sell government bonds or decrease the discount rate.
To increase the money supply, the Fed can a. buy government bonds or increase the discount rate. b. buy government bonds or decrease the discount rate. c. sell government bonds or increase the discount rate. d. sell government bonds or decrease the discount rate.

Explanation / Answer

Correct Answer:

The Federal Reserve buys the government securities and injects money into the market. Besides, the lowering of the interest rate, also increases the consumption as well as investment spending in the economy. So, economy is stimulated.

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To increase the money supply, the Fed can a. buy government bonds or increase th

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