The Fed's countercyclical policy during expansion and prosperity includes:
A) raising the required reserve ratio, raising the discount rate, and selling government bonds on the open market.
B) raising the required reserve ratio, raising the discount rate, and buying government bonds on the open market.
C) raising the required reserve ratio, cutting the discount rate, and selling government bonds on the open market.
D) raising the required reserve ratio, cutting the discount rate, and buying government bonds on the open market.
E) lowering the required reserve ratio, cutting discount rates, and buying government bonds on the open market.

Question

Quizplus · Accepted Answer

During expansion, the Fed aims to cool down the economy by reducing money supply, which is achieved by raising the required reserve ratio, raising the discount rate, and selling government bonds.

The Fed's Countercyclical Policy During Expansion and Prosperity Includes