Question 7 An example of a policy mix of expansionary monetary policy and contractionary fiscal policy is when: O More than one statement is correct. The Federal Reserve in lowering income taxes while the president and congress are raising interest rates. O The Federal Reserve is lowering interest rates while the president and congress are raising taxes. The Federal Reserve is increasing the supply of money and credit while the president and congress are cutting government spending. The Federal Reserve is cutting government spending while the president and congress are raising interest rates