Which of the following lists two things that both decrease the money supply?

a. raise the discount rate, make open market purchasesb. raise the discount rate, make open market salesc. lower the discount rate, make open market purchasesd. lower the discount rate, make open market sales

Question

Ainsley Nelson

Business

28 June, 10:06

Which of the following lists two things that both decrease the money supply?

a. raise the discount rate, make open market purchasesb. raise the discount rate, make open market salesc. lower the discount rate, make open market purchasesd. lower the discount rate, make open market sales

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Answers (1)

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Doogie · Answer 1

Answer: B. raise the discount rate, make open market sales are two things that both decrease the money supply.

Explanation: If the discount rate is high, less banks are likely to borrow money from the Federal Reserve because they will be paying a higher interest rate on the borrowed funds. Open market refers to banks buying and selling different government entities in an open market.

Which of the following lists two things that both decrease the money supply?a. raise the discount rate, make open market purchasesb. raise the discount rate, make open market salesc. lower the discount rate, make open market purchasesd. lower the discount rate, make open market sales

Which of the following lists two things that both decrease the money supply?

a. raise the discount rate, make open market purchasesb. raise the discount rate, make open market salesc. lower the discount rate, make open market purchasesd. lower the discount rate, make open market sales