One method the Federal Reserve System uses to slow the economy is to
A) sell government bonds to banks and other businesses.
B) decrease reserve requirements.
C) decrease the discount rate.
D) buy government securities.
E) decrease salaries paid to the board of governors.

Question

Quizplus · Accepted Answer

By selling government bonds to banks and other businesses, the Federal Reserve is decreasing the amount of money available in the economy. This reduces the money supply and can help slow down economic growth.

One Method the Federal Reserve System Uses to Slow the Economy