14.

If the Federal Reserve Board raises the discount rate to banking institutions, _____.

the interest rates decrease

the money supply in the economy increases

the interest rates remain unaffected

economic activity remains the same

economic activity slows down

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15.

If the Federal Reserve Board increases reserve requirements for banking institutions, _____.

banks make fewer loans

the money supply in the economy increases

banks have to pay a lower interest rate on loans taken from the Fed

banks have to pay a higher interest rate on loans taken from the Fed

economic activity increases

16.

If the Federal Reserve Board decreases reserve requirements for banking institutions, _____.

banks make fewer loans

the money supply in the economy increases

economic activity decreases

banks have to pay a higher interest rate on loans taken from the Fed

banks have to pay a lower interest rate on loans taken from the Fed