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If aggregate demand is growing faster than long run aggregate supply, the Federal Reserve is most likely to
(A) sell securities on the open market
(B) increase bond prices
(C) increase income taxes
(D) decrease the discount rate
(E) decrease the required reserve ratio


Sagot :

If aggregate demand is growing faster than long run aggregate supply, the Federal Reserve is most likely to -  sell securities on the open market.

What does the Federal Reserve simply do?

The Federal Reserve offers the USA a reliable, flexible, and secure financial and monetary instrument. The Fed's most significant responsibilities are providing financial services, preserving economic equilibrium, monitoring and regulating banks, and providing nationwide monetary coverage.

The Federal Reserve, sometimes known as the Fed, is the most effective economic organisation in the USA and arguably the whole world. Its primary responsibilities include maintaining the money supply, setting hobby quotations, and controlling the economy's markets.

The Federal Reserve is not supported by funds from Congress. Its operations are typically funded by interest gained on the securities it owns, which were acquired as a result of the Federal Reserve's open market operations.

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