If a government wanted to use monetary policy to increase economic growth,which of the following steps should be taken?

Question

Quizplus · Accepted Answer

Decreasing the discount rate (interest rate at which banks can borrow money from the Federal Reserve) would encourage banks to lend more money to individuals and businesses, increasing the amount of money in circulation and potentially stimulating economic growth. The other options (B, C, and D) do not directly impact the money supply or lending practices. Increasing foreign currency reserves would not necessarily boost domestic economic growth; raising taxes may actually decrease public revenue available for investment; and government spending on public works may not lead to long-term economic growth if the projects are not well-designed or executed.

If a Government Wanted to Use Monetary Policy to Increase