will upvote

(10) Under usual circumstances (i.e. a "standard" economic situation), an increase in the reserve requirement causes the federal funds rate to increase the federal funds rate to stay the same the discount rate to decrease the discount rate to increase the federal funds rate to decrease (11) Suppose the interest on reserves currently equals the federal funds rate. Further, the economy is booming and the Fed wants to create some 'cusion' in case there is a negative shock to the economy (E.g. they want to avoid the zero-bound problem). What monetary policy tool would you recommend to the Fed? conduct and open market sale increase the interest on reserves increase the discount rate decrease the reserve requirement conduct and open market purchase increase the reserve requirement decrease the interest on reserves decrease the discount rate