Question 17 1 point In order for the Fed to decrease interes

Question 17 (1 point) In order for the Fed to decrease interest rates, it must 1) request that Congress pass a law lowering rates. 2) request that banks lower the rates they charge on loans. 3) buy bonds from banks. 4) sell bonds to banks 5) simply change the number

Solution

Ans

3 is right answer. It should buy bonds for money. This will increase money supply in economy. Cost of credit to banks fall and they also reduce interest rates