Exam: 04.04 The Feds Toolbox Quiz – Flashcards
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Through which tool does the Federal Reserve affect money available for banks to loan?
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Reserve requirement
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Which of the following actions would the Federal Reserve most likely take to reduce unemployment?
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Buy government securities
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Which of the following actions would the Federal Reserve most likely take to rein in spiraling inflation?
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Increase reserve requirement
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Which tool does the Federal Reserve use to control monetary policy through bank borrowing?
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Discount rate
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Which of the following actions would the Federal Reserve most likely take during an economic recession?
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Lower discount rate