If the Fed lowers the discount rate, banks borrow more reserves from the Fed, which leads to an increase in the money supply.

Name: If the Fed lowers the discount rate, banks borrow more reserves from the Fed, which leads to an increase in the money supply.
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Lowering the discount rate makes it cheaper for banks to borrow from the Fed, which encourages more borrowing and increases the amount of reserves banks have available to lend out, leading to an increase in the money supply.

If the Fed Lowers the Discount Rate, Banks Borrow More