Question
In order to reduce demand-pull inflation caused by an overactive aggregate demand, the federal reserve bank should: A. sell government securities, lower reserve requirements, lower
In order to reduce demand-pull inflation caused by an overactive aggregate demand, the federal reserve bank should:
A. sell government securities, lower reserve requirements, lower the discount rate, and increase the amount of reserves available through the term auction facility
B. Buy government securities, raise reserve requirements, raise the discount rate, and reduce the amount of reserves available through the term auction facility.
C. sell government securities, raise reserve requirements, raise the discount rate, and reduce the amount of reserves available through the term auction facility
D. sell government securities, raise reserve requirements, lower the discount rate, and increase the amount of reserves available through the term auction facility
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