Raising the Discount Rate Is _____

Raising the discount rate is _____

A) an expansionary policy, because it raises the ratio of excess reserves to total reserves in the banking system.
B) a contractionary policy on the part of the member banks of the Fed, because it raises the firms' costs of borrowing from them.
C) a contractionary policy on the part of the Fed, because it raises the commercial banks' cost of borrowing from it.
D) an expansionary policy on the part of the member banks of the Fed, because it raises their profits relative to those of the nonmember banks.
E) an expansionary policy on the part of the Fed, because increasing the interest rates that the banks are allowed to charge will increase their willingness to make loans.