Macroeconomics
Review Quiz Answers 1. C 2. D 3. C 4. B 5. C 6. D 7. B 8. A 9. B 10. C Checkpoint Quiz Answers Checkpoint Quiz 1:
The discount rate and the federal funds rate are raised to discourage banks from borrowing which reduces lending and money supply. The IOR is increased to encourage commercial banks to deposit morereserveswiththeFed,whichreducestheirabilitytolendandincreasemoneysupply.Finally,therr is raised to reduce banks’ deposits and lending ability in order to reduce money supply.
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