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Please fill in the blanks. First blank: increases, reduces. Second blank: increasing, decreasing. Third blank: rise, fall. Fourth blank: decreases, increases. Fifth blank: decreases/increases The

Please fill in the blanks. First blank: increases, reduces. Second blank: increasing, decreasing. Third blank: rise, fall. Fourth blank: decreases, increases. Fifth blank: decreases/increases

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The Federal Reserves establishes the interest rate charged on funds it loans to banks and other financial institutions. A lower interest rate reduces the incentive to borrow funds from the Federal Reserve, thereby decreasing _ the quantity of reserves in the banking system, which causes the money supply to rise _ When the Federal Reserve loans less funds to banks and another financial institutions, the quantity of reserves in the banking system decreases _ and the money supply decreases

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