The Federal Reserve was able to curb the seemingly uncontrollable inflation that plagued the economy in the late 1970s and early 1980s by

Question

​The Federal Reserve was able to curb the seemingly uncontrollable inflation that plagued the economy in the late 1970s and early 1980s by

Quizplus · Accepted Answer

The Federal Reserve was able to curb inflation by raising interest rates. This made borrowing more expensive, reducing demand and slowing down economic growth, which in turn helped to lower inflation. Freezing the federal budget and restricting spending may have helped reduce inflation indirectly, but they are not direct measures taken by the Federal Reserve. Lowering interest rates would have actually worsened inflation by increasing demand and economic growth.

​The Federal Reserve Was Able to Curb the Seemingly Uncontrollable

The Federal Reserve Was Able to Curb the Seemingly Uncontrollable