When the economy is in a recession,the Federal Reserve generally attempts to increase business activity by easing credit via lower interest rates,which is accomplished by decreasing reserves (money supply).

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When the economy is in a recession, the Federal Reserve generally attempts to increase business activity by easing credit via lower interest rates, which is accomplished by increasing the money supply, not decreasing it. This often involves reducing the reserve requirements for banks or buying government securities to inject more liquidity into the banking system, encouraging lending and investment.

When the Economy Is in a Recession,the Federal Reserve Generally