If the country is heading into a recession,the Fed might be able to counteract this by

Question

Quizplus · Accepted Answer

The best option for the Fed to counteract a recession is by acting to increase the money supply. By doing so, the Fed can reduce interest rates which can encourage people and businesses to borrow and spend more. This can help to stimulate economic growth and increase demand. Options A and C would have the opposite effect as increasing the discount rate or forcing the government deficit to decrease would reduce the money supply and increase interest rates. Option B involves fiscal policy which is carried out by the government rather than the Federal Reserve.

If the Country Is Heading into a Recession,the Fed Might