Answer the following questions true (T) or false (F)

1. If the Fed wishes to decrease the supply of money and credit, it may sell government securities, raise the discount rate, or lower required reserve ratios.

2. The Fed was founded in 1913 to serve as lender of last resort to bankers during bank runs and panics.

3. If the rate of growth in real GDP exceeds the rate of growth in the money supply, the quantity theory of money predicts a price deflation.

1. FALSE
2. TRUE
3. TRUE