which statement best describes how the fed responds to recessions? it sells more securities. it charges…

which statement best describes how the fed responds to recessions? it sells more securities. it charges banks more interest. it increases reserve requirements. it increases the money supply.

which statement best describes how the fed responds to recessions? it sells more securities. it charges banks more interest. it increases reserve requirements. it increases the money supply.

Answer

Brief Explanations:

During recessions, the Federal Reserve (Fed) aims to stimulate the economy. Selling more securities reduces the money - supply, charging banks more interest makes borrowing expensive for banks and in turn for businesses and consumers, and increasing reserve requirements restricts the amount of money banks can lend. Increasing the money supply makes more funds available for borrowing, which can stimulate spending and investment to boost the economy.

Answer:

It increases the money supply.