If inflation starts to increase, the Federal Reserve is likely to:

Question

Quizplus · Accepted Answer

If inflation starts to increase, the Federal Reserve is likely to increase interest rates to slow down spending and investment, which can decrease inflation. This is because higher interest rates mean that it costs more to borrow money, so people and businesses are less likely to do so, reducing overall spending and inflation. The other options (A, C, D, and E) are not likely to be implemented in response to rising inflation.

If Inflation Starts to Increase, the Federal Reserve Is Likely