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13 January, 11:04

When the federal reserve decreases the federal funds target rate, the lower rate is achieved through?

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  1. 13 January, 11:14
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    When the federal reserve decreases the federal funds target rate, the lower rate is achieved through: purchases of government bonds, which reduces interest rates and causes people to hold more money.

    The more amount of money circulated within the people, the lower the value of the currency would be, which lead to lower rate because it repels potential investment in the country.
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