To fight a recession, the Fed might: a. increase the reserve requirement and the discount rate b. buy bonds in the open market and decrease the discount rate c. increase the reserve requirement and decrease the discount rate d. decrease the reserve requirement and increase the discount rate e. sell bonds on the open market 14.

Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter11: The Monetary System
Section: Chapter Questions
Problem 5CQQ
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To fight a recession, the Fed might:
a. increase the reserve requirement and the discount rate
b. buy bonds in the open market and decrease the discount rate
c. increase the reserve requirement and decrease the discount rate
d. decrease the reserve requirement and increase the discount rate
e. sell bonds on the open market
14.
Transcribed Image Text:To fight a recession, the Fed might: a. increase the reserve requirement and the discount rate b. buy bonds in the open market and decrease the discount rate c. increase the reserve requirement and decrease the discount rate d. decrease the reserve requirement and increase the discount rate e. sell bonds on the open market 14.
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