how can the federal reserve slow economic growth?\na by reducing interest rates\nb by increasing the money…
how can the federal reserve slow economic growth?\na by reducing interest rates\nb by increasing the money supply\nc by increasing the number of bonds it purchases\nd by reducing the amount of money available for lending by banks
Answer
Brief Explanations:
When the Federal Reserve reduces the amount of money available for lending by banks, it tightens credit conditions. This makes it harder and more expensive for businesses and consumers to borrow money. As a result, spending and investment decrease, which slows economic growth. Reducing interest rates, increasing the money - supply, and increasing bond purchases all tend to stimulate economic growth rather than slow it.
Answer:
D. by reducing the amount of money available for lending by banks