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Which of the Following Would Constitute Contractionary Monetary Policy by the Fed

Question 45

Multiple Choice

Which of the following would constitute contractionary monetary policy by the Fed?


A) A decrease in the interest rate it pays on reserves
B) Open market sales of government securities and an increase in the discount rate
C) An increase in tariffs on imported goods and a decrease in foreign aid
D) Open market purchases of government securities and a cut in the discount rate
E) An increase in the reserve ratio and a cut in the discount rate

Correct Answer:

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