If the Fed fears a recession, it

Question

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When the Fed fears a recession, it typically buys government securities in order to increase the money supply and lower interest rates, which can stimulate borrowing and spending by consumers and businesses. This can help increase aggregate demand and reduce the likelihood of a recession. Selling government securities or decreasing the quantity of money would have the opposite effect, potentially worsening the recession. Decreasing aggregate demand or supply would also likely worsen the recession, as it could lead to further decreases in consumer and business spending and investment.

If the Fed Fears a Recession, It