When the Fed reduces the discount rate, it is more likely that the economy experiences _________ and the fall in the rate will _____________
a. inflation; decrease the use of open market operations
b. inflation; decrease the federal funds rate as well
c. recession; increase the federal funds rate as well
d. recession; decrease the cost to banks of borrowing from the Fed
e. inflation; decrease the cost to banks of borrowing from the Fed
D
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________ is the market structure in which there are a few rival firms
A) Perfect competition B) Monopolistic competition C) Monopoly D) Oligopoly
Which of the following is not assumed before the implementation of a policy? a. The appropriate policy is selected instantaneously
b. The appropriate policy is implemented instantaneously. c. Once implemented, the policy works as advertised. d. The policy, once implemented, works in no time. e. Lags that reduce the effectiveness of the policy are predictable.