The Federal Reserve Wants To Encourage Banks To Lend More Money In Order To Increase The Amount Of Money Avail?

The Federal Reserve wants to encourage banks to lend more money in order to increase the amount of money available. To do this, the Fed would
A. reduce the money supply B. raise the reserve ratio C. reduce the discount rate D. increase the discount rate

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One Response to “The Federal Reserve Wants To Encourage Banks To Lend More Money In Order To Increase The Amount Of Money Avail?”

  1. Dizza says:

    c. by reducing the discount rate, banks would supposedly borrow more; but this doesn’t mean they would lend more.
    Most banks would turn it around and invest it so they get more interest – like loan it to Brasil or Russia.

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