If the Federal Reserve wished to engage in expansionary monetary policy it could

Question

Quizplus · Accepted Answer

Lowering the primary credit rate reduces the cost for banks to borrow money from the Federal Reserve, encouraging them to increase lending and stimulate economic growth, making it an expansionary monetary policy tool.

B) Selling government debt is a contractionary monetary policy because it reduces the money supply in the economy. 
C) Raising the reserve ratio is also a contractionary monetary policy because it increases the reserve amount that banks must hold, reducing their ability to lend and decreasing the money supply. 
D) Raising the Federal Funds rate target is also a contractionary monetary policy because it increases the cost of borrowing money, leading to decreased lending and decreasing aggregate demand in the economy.

If the Federal Reserve Wished to Engage in Expansionary Monetary